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Notes to Accounts of Walchand Peoplefirst Ltd.

Mar 31, 2015

1A General Information:

Walchand PeopleFirst Limited (the 'company') is engaged in the business to impart training in soft skills like leaderships, communication, presentation, etc. The Company had acquired the franchise rights to offer, sell, teach and impart the training methods, techniques and programs developed by Dale Carnegie Training & Asso ciates, U.S.A. to individual and employees of the corporate.

2.1 Of the above Equity shares :

(a) 11,666 Shares were issued in 1961 by converting 35,000 Promoters' Shares of Rs. 3.75 each (Rs. 1,31,250) into 11,666 Shares of Rs.11.25 each and by utilising Rs. 2,18,730 from Capital Reserves for issue of 11,666 Shares of Rs. 18.74936 each and consolidating the two.

(b) 43,333 Shares of Rs. 30 each were issued in 1961 as Bonus Shares by utilising Capital Reserve of Rs. 12,99,990.

(c) During 1966, the face value of 1,71,675 Equity Shares was increased from Rs. 30 each to Rs. 50 each by utilising Rs. 34,33,500 from Reserve for Investments and Advances. Further 34,335 bonus Equity Shares of Rs. 50 each were issued as fully paid by capitalisation of Rs. 17,16,750 out of General Reserve.

(d) During 1970, the face value of equity Shares was increased from Rs. 50 to Rs. 60 per share by capitalising Rs. 20,60,100 from General Reserve.

(e) During 1984, the face value of Equity Shares was increased from Rs. 60 to Rs. 100 per share by capitalising Rs. 82,40,400 from General Reserve.

(f) During 1994-95, 78,880 Equity Shares of Rs. 100 each were issued to the promoters on the preferential basis.

(g) During 2009-10, 5499 Equity Shares of Rs 100 each were issued to one of the shareholder of the transferor company - Walchand TalentFirst Limited, on account of the scheme of amalgamation.

(h) During 2011-12, 2,90,389 Equity shares of Rs 100 each were subdivided into 29,03,890 shares of Rs 10/ each.

2.2 Terms and rights

The company has only one class of equity shares having a par value of Rs 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian rupees. The dividend proposed by the Board ofDirectors is subject to the approval of the shareholders in the ensuing Annual General Meeting.During the year the amount of dividend per share recommended by the Board of Directors to equity shareholders was Re 1. (31st March,2014 - Nil).

2.3 Holding company share holding details:-

Out of the 29,03,890 Equity shares, 15,20,486 Equity Shares are held by the holding company.(Previous year out of 29,03,890 Equity shares, 15,05,974 Equity Shares are held by the holding company).

The Board of Directors have recommended a final dividend of 10% in its Board meeting held on 6th May,2015 which is subject to shareholders' approval.The total amount of dividends proposed to be distributed to equity shareholders for the period April,2014 to March,2015 is Rs 29.04 Lacs.

Disclosures under Micro, Small and Medium Enterprises Act

Company has sent letters to suppliers to confirm whether they are covered under Micro, Small and Medium Enterprises Act, 2006 as well as they have filed required memorandum with the prescribed authorities. This information is required to be disclosedunder the Micro, Small and Medium enterprises development Act,2006 and has been determined to the extent such parties have been identified on the basis of the information available with the company and have been relied upon by the auditors.

2.4 CONTINGENT LIABILITIES AND COMMITMENTS

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

Income tax Demands for A.Y 09-10 to A.Y. 12-13 amounting to Rs 178.70 lacs (previous year Rs 87.58 lacs) has been disputed by the company before CIT (Appeals)/Income Tax Tribunal. The management doesn't expect any liability crystallizing in these cases. 178.70 87.58

Municipal Corporation of Greater Mumbai (BMC) has demanded Rs 276.88 lacs (Previous year Rs 146.28 lacs) on account of Property Tax payable for the period 01st April, 2000 to 31st March, 2015. The company had filed an appeal and has been successful in the Court of Small Causes, Mumbai against which BMC has filed an appeal which is pending in Bombay High Court. Subsequently, around 2012 BMC changed the method of computation w.e.f A-Y 2010 to " Capital Based System" and had demanded new bills amounting to Rs 134.83 Lacs for the period FY-2010-11 till FY-2014-15 and taken further action. This has been also challenged before the Assessment Officer. Based on the legaladvice obtained in this case, the management believes that the ultimate outcome of this proceeding will be in companies favor and will not adversely impact the company's financial position. 276.88 146.28

2.5 RELATED PARTY DISCLOSURES:- A Description of Companies:

Name of the Related Party Walchand & Company. Pvt. Ltd. Walchand Netsoft Pvt Ltd.

Walchand Diamond Jubilee Trust

Nature of Relationship Holding Company Controlled Company Directors as Trustee

B Key Management Personnel: Name of the Related Party Mrs. Pallavi Jha Mr. Sanjay Jha Ms Shruthi Patni

Nature of Relationship

Chairperson & Managing Director Whole Time Director Chief Financial Officer

C Relative of Key Management Personnel: Name of the Related Party Mrs. Kamalini Bahubali Ms. Maithili Jha

Nature of Relationship

Mother of Chairperson & Managing Director Daughter of Chairperson & Managing Director


Mar 31, 2014

1 CONTINGENT LIABILITIES AND COMMITMENTS Rs. in Lacs

Particulars As at As at March 31, 2014 March 31, 2013

Income tax liability on disputed dues 87.58 76.89

In relation to payment of Rates and Taxes payable to Municipal Corporation of Great Mumbai (BMC) for the period from 1st April,2000 to 31st March 2014 the demand amount stated is disputed and Appeal is pending before the High Court. 146.28 145.66

In relation to Lease rental payable to Mumbai Port Trust the disputed amount stated has been challenged by the Company in the City Civil Court. 110.84 103.23

2 RELATED PARTY DISCLOSURES:- A Description of Companies: Name of the Related Party Walchand & Company Pvt. Ltd. Walchand Netsoft Pvt Ltd. Walchand Diamond Jubilee Trust Nature of Relationship Holding Company Controlled Company Directors as Trustee

B Key Management Personnel: Name of the Related Party Mrs. Pallavi Jha Mr. Sanjay Jha

Nature of Relationship Chairperson & Managing Director Whole Time Director

C Relative of Key Management Personnel: Name of the Related Party Mrs. Kamalini Bahubali

Nature of Relationship

Mother of Chairperson & Managing Director

3 Employee benefit disclosure

The Company has classified various employee benefits as under.


Mar 31, 2013

1.1 Of the above Equity shares:

(a) 11,666 Shares were issued in 1961 by converting 35,000 Promoters'' Shares of Rs. 3.75 each (Rs. 1,31,250) into 11,666 Shares of Rs.11.25 each and by utilising Rs. 2,18,730 from Capital Reserves for issue of 11,666 Shares of Rs. 18.74936 each and consolidating the two.

(b) 43,333 Shares of Rs. 30 each were issued in 1961 as Bonus Shares by utilising Capital Reserve of Rs. 12,99,990.

(c) During 1966, the face value of 1,71,675 Equity Shares was increased from Rs. 30 euch to Rs. 50 each by utilising Rs.34,33,500 from Reserve for Investments and Advances. Further 34,335 bonus Equity Shares of Rs. 50 each were issued as fully paid by capitalisation of Rs. 17,16,750 out of General Reserve.

(d) During 1970, the face value of equity Shares was increased from Rs. 50 to Rs. 60 per share by capitalising Rs. 20,60,100 from General Reserve.

(e) During 1984, the face value of Equity Shares was increased from Rs. 60 to Rs. 100 per share by capitalising Rs. 82,40,400 from General Reserve.

(f) During 1994-95, 78,880 Equity Shares of Rs. 100 each were issued to the promoters on the preferential basis.

(g) During 2009-10,5499 Equity Shares of Rs 100 each were issued to one of the shareholder of the transferor company - Walchand TalentFirst Limited, on account of the scheme of amalgamation.

(h) During 2011-12, 2,90,389 Equity shares of Rs 100 each were subdivided into 29,03,890 shares of Rs. 10/ each.

1.2 Terms and rights

The company has only one class of equity shares having a par value of Rs 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian rupees. 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 31st March,2013 the amount of dividend per share recommended by the Board of Directors to equity shareholders was Re 1. (31st March,2012 - Re 1).

1.3 Holding company share holding details:-

Out of the 29,03,890 Equity shares, 15,01,556 Equity Shares are held by the holding company.(Previous year out of 29,03,890 Equity shares, 15,00,064 Equity Shares are held by the holding company).

2.1 The term loan from bank which is secured by the hypothecation of vehicles carries interest @ 10.87 % p.a. The loan is repayable in 35 equal monthly installments of Rs 1,08,162 each along with the interest from the 10th October, 2011. The balance number of months left for the payment of EMI from 31st March,2013 is 17.

2.2 The term loan from bank which is secured by the hypothecation of moveable and immoveable fixed asset carries interest @ 13.50 % p.a. The loan is repayable in 28 equal monthly installments of Rs 3,93,151 each along with the interest from the 7th February,2011. The balance number of months left for the payment of EMI from 31st March,2013 is 2.


Mar 31, 2012

1.1 Oi the above Equity shares :

(a) 11,666 Shares were issued in 1961 by converting 35,000 Promoters' Shares of Rs. 3.75 each (Rs. 1,31,250) into 11,666 Shares of Rs.11.25 each and by utilising Rs. 2,18,730 from Capital Reserves for issue of 11,666 Shares of Rs. 18.74936 each and consolidating the two.

(b) 43,333 Shares of Rs. 30 each were issued in 1961 as Bonus Shares by utilising Capital Reserve of Rs. 12,99,990.

(c) During 1966, the face value of 1,71,675 Equity Shares was increased from Rs. 30 each to Rs. 50 each by utilising Rs.34,33,500 from Reserve for Investments and Advances. Further 34,335 bonus Equity Shares of Rs. 50 each were issued as fully paid by capitalisation of Rs. 17,16,750 out of General Reserve.

(d) During 1970, the face value of equity Shares was increased from Rs. 50 to Rs. 60 per share by capitalising Rs. 20,60,100 from General Reserve.

(e) During 1984, the face value of Equity Shares was increased from Rs. 60 to Rs. 100 per share by capitalising Rs. 82,40,400 from General Reserve.

(f) During 1994-95, 78,880 Equity Shares of Rs. 100 each were issued to the promoters on the preferential basis.

(g) During 2009-10, 5499 Equity Shares of Rs 100 each were issued to one of the shareholder of the transferor company - Walchand Talent First Limited, on account of the scheme of amalgamation.

(h) During 2011-12, 2,90,389 Equity shares of Rs 100 each were subdivided into 29,03,890 shares of Rs 10/ each.

1.2 Terms and rights

The company has only one class of equity shares having a par value of Rs 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian rupees. 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 31st March,2012 the amount of dividend per share recommended by the Board of Directors to equity shareholders was Re 1. (31st March,2011 - Nil).

1.3 Holding company share holding details:-

Out of the 29,03,890 Equity shares, 15,00,064 Equity Shares are held by the holding company.(Previous year out of 2,90,389 Equity shares, 147,769 Equity Shares are held by the holding company).

The Board of Directors have recommended a final dividend of 10% in its Board meeting held on 18th May,2012 which is subject to shareholders' approval.

The total amount of dividends proposed to be distributed to equity shareholders for the period April, 2011 to March,2012 is Rs 29.04 Lacs.

2.1 The term loan from bank which is secured by the hypothecation of vehicles carries interest @ 10.87 % p.a. The loan is repayable in 35 equal monthly installments of Rs 1,08,162 each along with the interest from the 10th October, 2011. The balance number of months left for the payment of EMI from 31st March,2012 is 29.

2.2 The term loan from bank which is secured by the hypothecation of moveable and immoveable fixed asset carries interest @ 13.50 % p.a. The loan is repayable in 26 equal monthly installments of Rs 3,43,354 each along with the interest from the 7th February,2011. The balance number of months left for the payment of EMI from 31st March,2012 is 14.

Disclosures under Micro, Small and Medium Enterprises Act

Company has sent letters to suppliers to confirm whether they are covered under Micro, Small and Medium Enterprises Act, 2006 as well as they have filed required memorandum with the prescribed authorities. Out of the letters send to the parties, some confirmations have been received till the date of finalization of Balance Sheet.

b) The company has entered into operating lease arrangements for its office premises and employee accomodation which are cancellable and renewable as per terms. The related rent expenses is Rs 29.49 Lacs.(Previous Year - Rs 22.00 Lacs).

c) Lease training centre expenses is Rs 142.83 Lacs . (Previous year - Rs 169.38 Lacs).

3 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Rs. in Lacs

Particulars As at As at March 31, 2012 March 31, 2011

Income tax liability on disputed dues 59.98 46.14

Corporate Guarantee given to a bank on behalf of Walchand and Company Private Limited - 20.26

In relation to payment of Rates and Taxes payable to Municipal Corporation of Great Mumbai (BMC) for the period from 1st April,2000 to 31st March 2012 the demand amount stated is disputed and Appeal is pending before the High Court. 210.18 176.98

In relation to Lease rental payable to Mumbai Port Trust the disputed amount stated has been challenged by the Company in the City Civil Court. 95.91 88.87

(ii) Defined Benefit plan - Gratuity:

The following table summarizes the components of expense related to defined benefit plan recognized in the Profit and Loss account, the funded status and amounts recognized in the Balance Sheet for the plan.


Mar 31, 2011

1) Contingent Liabilities

S. Particulars As at March 31, 2011 As at March 31, 2010 No Rs in Lakhs Rs in Lakhs

(a) Income tax liability on disputed dues

- Disputed amount 89.16 390.05

- Tax amount on above 46.14 151.36

(b) Corporate Guarantee given to a bank on behalf of Walchand and Company Private Limited (Balance outstanding as on March,31) 20.26 60.89

(c) In relation to payment of Rates and Taxes payable to Municipal Corporation of Great Mumbai (BMC) for the period from 1st April,2000 to 31st March 2011 the demand amount stated is disputed and Appeal is pending before the High Court. 176.98 143.78

(d) In relation to Lease rental payable to Mumbai Port Trust the disputed amount stated has been challenged by the Company in the City Civil Court. 88.87 33.39

2) Capital commitment

The estimated amount of contract remaining to be executed on capital account and not provided for as on March 31, 2011 is Rs 21.29 Lakhs (Previous Year - Rs NIL).

3) Related Party Disclosures

A. Description of Companies:

Name of the Related Party Nature of Relationship

i) Walchand & Company Pvt. Ltd. Holding Company

ii) Walchand Netsoft Pvt. Ltd Controlled Company

B. Key Management Personnel:

Name of the Related Party Nature of Relationship

(i) Mrs. Pallavi Jha Chairperson & Managing Director

(ii) Mr. Sanjay Jha Whole Time Director

C. Relative of Key Management Personnel:

Name of the Related Party Nature of Relationship

(i) Mrs. Kamalini Bahubali Mother of Ms.Pallavi Jha

4) Segment Reporting

Walchand PeopleFirst Limited is engaged in the business of training in soft skills. Also, there are investments held from which income is derived. All the operations are carried out in India.

5) Leases taken

b) The Company has entered into operating lease arrangements for its office premises and employee accommodation which are cancelable and renewable as per terms. The related rent expense is Rs 22.00 Lakhs (Previous Year - Rs 114.57 Lakhs including equipments).

c) Lease training center expense is Rs.169.38 lakhs (previous year - Rs 150.77 lakhs).

6) Disclosures under Micro, Small and Medium Enterprises Act

Company has sent Setters to suppliers to confirm whether they are covered under Micro, Small and Medium Enterprises Act, 2006 as well as they have filed required memorandum with the prescribed authorities. Out of the letters send to the parties, some confirmations have been received till the date of finalization of Balance Sheet.

7) In the opinion of the Board, the current assets, loans and advances are realizable in the ordinary course of business at least at the value as stated in the financials statements.

8) Additional information pursuant to the provisions of paragraph 3 & 4 of Part II of Schedule VI to the Companies Act, 1956 is either NIL or not applicable.

9) Previous years figures have been regrouped/ recast wherever found necessary.


Mar 31, 2010

1. In the opinion of the Board, the current assets, loans and advances are approximately of the value stated if realised in the ordinary course of business. The provisions for all known Liabilities are adequate.

2. Contingent Liabilities:

Particulars As at 31st March,2010 As at 31st March,2009 (Rs in Lacs) (Rs in Lacs)

(a) The Income Tax assessment of the Company is completed upto Assessment Year 2006-2007. The total disputed amount under appeals are stated,tax liability on which is not ascertainable which are pending before the Income Tax authorities. Management does not foresee any tax liability materializing from the same. 390.05 418.63

b) Corporate Guarantee given to a bank on behalf of Walchand & Company Pvt Ltd 240.00 240.00

(c) Corporate Guarantee given to a bank on behalf of Walchand TalentFirst Limited. - 250.00

(d) In relation to payment of Rates & Taxes payable to Municipal Corporation of Great Mumbai (B M C) for the period from 1st April 2000 to 31st March 2010 the demand amount stated is disputed and Appeal is pending before the High Court. 143.78 110.60

(e) In relation to Lease rental payable to Mumbai Port Trust the disputed amount stated has been challenged by the Company in the High Court. 33.39 33.39

3. (a) Name of the amalgamating companies- Walchand TalentFirst Limited

(b) Nature of Business - Talent Development, Training, Coaching and other allied Management Services

(c) Method Of Accounting used for amalgamation—Pooling Of Interest Method

(d) Effective Date of Amalgamation for Accounting Purpose - 01.04.2009

(e) Particulars of the Scheme-

During the year the scheme of Arrangement and Amalgamation ("the Scheme") of Walchand PeopleFirst Limited (WPFL) and Walchand TalentFirst Limited (WTFL) was duly approved by the Board of the Company at its meeting held on 17th September,2009 and subsequently approved by the Honorable High Court of Mumbai vide order dated 9th April,2010 and was filed with Registrar Of Companies on 6th May,2010. Pursuant to the above Scheme the entire business and all assets and liabilities of Walchand TalentFirst Limited will be transferred and vested in the Walchand PeopleFirst Limited effective from 01st April,2009 in the financial year 2010 -11. Hence, the financial statements are revised for the year ended 31st March 2010, which were earlier adopted on 10th May 2010, in order to give the effect of this scheme.

The operations of Walchand TalentFirst Limited being mainly the training business will continue with Walchand PeopleFirst Limited. All the assets and liabilities of Walchand TalentFirst Limited will be merged in the books of Walchand PeopleFirst Limited in accordance with the aforesaid scheme of merger. Consequently, Walchand TalentFirst Limited will no longer be in existence post this merger. The merger is consistent with the Companys long-term strategy to focus its activities in the areas of training and to integrate, rationalize and streamline the management structure of the merged business. This scheme of merger is effective from the appointed date being 1st April, 2009.

The amalgamation is in the nature of merger and thus qualify to be accounted for under "Pooling of interest Method" as per Accounting Standard (AS-14)- "Accounting for Amalgamations" issued by the Institute of Chartered Accountant of India as stated in the Companies (Accounting Standards) Rules, 2006 and any amendments thereto. Accounting treatment as per the scheme approved by the Honorable High Court will be as under:

- All the assets and liabilities of Amalgamating Company will be transferred to Amalgamated Company at their book values as at the close of business of the day immediately preceding the Appointed Date.

- The investments in the Equity Share Capital of Amalgamating Company of Rs. 1265 Lacs appearing in the books of accounts of Amalgamated Company will stand cancelled.

- The inter-company loans, bonds, debentures, advances, deposit balances or other obligations as between the Transferor Company and the Transferee Company will stand cancelled.

- The amount of Goodwill appearing in the books of accounts of the amalgamating Company as at the appointed date shall be adjusted against the "General reserve account" in the books of the a malgamated Company.

- An amount equal to the balance lying to the debit balance of the profit and loss in the books of the accounts of the transferor Company shall be adjusted against the transferee Company to its "General reserve" account.

- The Capital Redemption Reserve to the extent excess of Preference Share Holders unclaimed liability shall be transferred to General Reserve Account.

- The deficit of the book value of the net assets of the Transferor Company, as appearing in the Books of Account of the Transferor Company, over the paid up value of the shares, to be issued and allotted, pursuant to Clause 13 above, shall be respectively credited to the "General Reserve Account".

(f) 5499 Equity shares were issued to one of the share holder of Walchand TalentFirst Limited pursuant to amalgamtion with the company. The percentage of the equity shares exchanged to effect the amalgamation is 1.8936%.

(g) Details of assets and liabilities are as follows :

- The Investment in the Equity Share Capital of the Walchand TalentFirst Limited of Rs. 1265 Lac/- appearing in the books of accounts of the Company stands cancelled.

- Inter- Company balance stand to be cancelled.

4. Related Party Disclosures:

A. Description of Companies: -

Name of the Related Party Nature of Relationship

i) Walchand & Co. Pvt. Ltd. Holding Company

ii) Walchand Netsoft Pvt Ltd (Formerly WalchandCricketnext.com Private Limited) Controlled Company

iii)Walchand TalentFirst Limited Subsidiary during 08-09 (Merged with Walchand People First Ltd. w.e.f April 1,2009)

B. Key Management Personnel: -

Name of the Related Party Nature of Relationship

Mrs. Pallavi Jha Chairperson & Managing Director

Mr. Sanjay Jha Whole Time Director

C. Relative of Key Management Personnel: -

Name of the Related Party Nature of Relationship

Mrs. Kamalini Bahubali Mother of Ms.Pallavi Jha

5. Employee benefit disclosure - AS - 15

The Company has classified various employee benefits as under; (A) Defined contribution plans

a. Provident Fund

b. Superannuation Fund

The Provident Fund are operated by the Regional Provident Fund Commissioner and Trustee of Construction Employees Provident Fund and the superannuation fund is administered by the Life Insurance Corporation of India. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities. The Company has recognized the following amounts in the Profit and Loss Account for the year

(B) Gratuity and other post-employment benefit plans: (AS 15 120(b))

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the plans.

Other Terms

ii) Additional amount of Service Tax will be paid on these rentals as per the applicable rates existing at the time of payment • Rs.146.19 lacs has been grouped under Training Centre expenses in Profit and Loss Account .

- After the completion of 1 year from their respective dates of inception, lease rent will get escalated as per the agreement.

Other Terms

i) The Operating lease arrangements extend for a maximum of 3 years from their respective dates of inception and relate to rented premises.

ii) Additional amount of Service Tax will be paid on these rentals as per the applicable rates existing at the time of payment

iii) After the completion of 1 year from their respective dates of inception, lease rent will get escalated as per the agreement.

* In the absence of lease period in the agreements entered with Assistant Collector of Central Excise and Anuditi investment Pvt Ltd. pertaining to future years, the future rental values are not disclosable.

* There are no restrictions on further sub lease. Some assets are given on further sub lease by lessee.

* Additional amount of Service Tax will be collected on these rentals as per the applicable rates existing at the time of payment

* After the completion of 1 year from their respective dates of inception, lease rent will get escalated as per the agreement.

6. Previous years figures have been regrouped/ rearranged wherever found necessary. Further, previous years figures are not comparable with the current year as current years figures include the amalgamated amounts.

7. Figures in bracket reflect the figures for previous year.

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