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Notes to Accounts of Wendt India Ltd.

Mar 31, 2017

Note 1 - Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Note 2 - Research and Development Expenditure

Research and Development expenditure incurred during the year aggregates to Rs. 243.25 lakhs (Previous year Rs. 246.26 lakhs) as detailed below:

Note:- Revenue expenditure shown above includes Depreciation on R&D assets of Rs. 46.96 lakhs (Previous year Rs.48.08 lakhs), Consultancy Services of Rs. 30.78 lakhs (Previous year Rs. 78.59 lakhs), Consultancy travel expenditure of Rs. 4.17 lakhs (Previous year Rs. 14.99 lakhs) & Contract manpower of Rs. 0.16 lakhs (Previous year Rs. 1.41 lakhs).

Note 3 - Corporate Social Responsibility

(a) Gross amount required to be spent by the company during the yearRs. 32.34 lakhs (Previous Year Rs. 35.27 lakhs)

(b) Amount spent by the company during the year Rs. 32.34 lakhs (Previous Year Rs. 38.45 lakhs)

Note 4 - Disclosure on Specified Bank Notes (SBN)

During the year, the Company had specified bank notes or other denomination note as defined in the MCA notification G.S.R. 308(''E) dated March 31, 2017 on the details of Specified Bank Notes (SBN) held and transacted during the period from November 8,2016 to December 30,2016, the denomination wise SBNs and other notes as per the notification is given below:

Note 5 - First-time Adoption of Ind AS

These standalone financial statements, for the year ended March 31, 2017, are the first the Company has prepared in accordance with Ind-AS. For periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with statutory reporting requirement in India immediately before adopting Ind AS (''previous GAAP'').

Accordingly, the Company has prepared financial statements which comply with Ind-AS applicable for periods ending on or after March 31, 2017, together with the comparative period data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies in Note 2. In preparing these financial statements, the Company''s opening balance sheet was prepared as at April 1, 2015, the Company''s date of transition to Ind-AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 1, 2015 and the financial statements as satand for the year ended March 31,2016.

6 Exemptions & Exceptions Applied

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has accordingly applied the following exemptions:

7 (a) Investments in subsidiaries

The Company has elected to adopt the carrying value under previous GAAP as on the date of transition i.e. April 1, 2015 in its separate financial statements.

8 (b) Estimate exception

Upon an assessment of the estimates made under Indian GAAP, the company has concluded that there was no necessity to revise such estimates under Ind AS, except where estimates were required by Ind AS and not required by Indian GAAP.

9 Reconciliations

(I) Reconciliation of equity as previously reported under Indian GAAP to IND AS

(ii) Reconciliation of Profit and Total Comprehensive income as previously reported under Indian GAAP to IND AS

(iii) Effect of I nd AS adoption on the balance sheet as at March 31, 2016 and April 1,2015

(iv) Effect of I nd AS adoption on the statement of profit or loss for the year ended March 31, 2016

(v) Effect of I nd AS adoption on the statement of cash flows for the year ended March 31, 2016

(vi) Analysis of cash and cash equivalents as at March 31,2016 and as at April 1,2015 for the purpose of statement of cash flows under Ind AS

Notes for the above reconciliations:

(a) Under previous GAAP, current investments were measured at lower of cost or fair value. Under Ind AS, these financial assets have been classified as FVTPL on the date of transition. The fair value changes are recognized in profit or loss. On transitioning to Ind AS, these financial assets have been measured at their fair values which is higher than cost as per previous GAAP, resulting in an increase in carrying amount by Rs.32.93 lakhs as at March 31,2016 and by Rs.4.19 lakhs as at April 1,2015. The corresponding deferred taxes have also been recognized as at March 31, 2016 (Rs. 12.78 lakhs) and as at April 1, 2015(Rs.1.42 lakhs), and also for the year ended March 31,2016 (Rs.9.94 lakhs). The net effect of these changes is an increase in total equity as at March 31, 2016 of Rs.24.34 lakhs (Rs. 2.77 lakhs as at April 1, 2015), increase in profit before tax of Rs.28.74 lakhs and in total profit for the year ended March 31, 2016 of Rs. 18.80 lakhs.

(b) Under previous GAAP, dividend on equity shares recommended by the board of directors after the reporting period but before the financial statements were approved for issue were recognized in the financial statements as a liability. Under Ind AS, such dividends and taxes thereon are recognized when declared by the members in a general meeting. The effect of this change is an increase in total equity as at March 31, 2016 of Rs. 361.07 lakhs (Rs.359.99 lakhs as at April 1,2015), but does not affect the profit before tax and total profit for the year ended March 31,2016.

(c) Under previous GAAP, actuarial gains and losses were recognized in profit or loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability / asset which is recognized in other comprehensive income. The actuarial losses for the year ended March 31, 2016 were Rs.48.34 lakhs. This does not affect the total equity, but there is an increase in profit before tax of Rs.48.34 lakhs, and in total profit of Rs.48.34 lakhs, for the year ended March 31,2016.

(d) Under previous GAAP, revenue from sale of goods was presented net of excise duty under revenue from operations. Whereas under Ind AS, revenue from sale of products includes excise duty. The corresponding excise duty expense is presented separately on the face of the statement of profit or loss. The change does not affect total equity as at April 1, 2015 and March 31,2016, profit before tax or total profitfor the year ended March 31,2016.

(e) Under previous GAAP, deferred tax were calculated on Profit & loss approach, whereas under Ind AS, deferred tax to be calculated on Balance sheet approach. This adjustment has resulted in an increase in deferred tax liability by Rs.0.35 lakhs and have resulted in a decrease inequity under Ind AS by Rs.0.35 lakhs as at April 1,2015 and March 31,2016.

(f) Under previous GAAP, capital advance were shown under Long term Loans & advances, whereas under Ind AS, the same is included in capital work in progress of Rs.9.05 lakhs as at March 31,2016 & Rs.40.39 lakhs as at April 1,2015.

(g) Under previous GAAP, book overdraft of Rs.48.66 lakhs as at March 31, 2016 were shown under Other current liabilities, whereas under Ind AS, the same is shown under other financial liabilities. Further, for the purpose of cash and cash equivalent for statement of cash flow, book overdraft is a part of cash and cash equivalents and hence, an amount of Rs. 48.66 lakhs is reduced.

Note 10 - Business Combinations

The Company had acquired the "Diamond Tool" business from Star Diamond Tools Private Limited at a consideration of Rs. 250 lakhs, under slump sale on March 29,2016.

This acquisition is made to enhance the company''s offerings in the field of one of our existing product line stationery dressers and this would also augment our existing manufacturing capability and capacity.

Consideration transferred

(I) The initial accounting for the acquisition of the business was provisionally determined as at the year ended March 31,2016, pending installation of the tangible assets and registration of the intangible assets. Accordingly, as on March 31, 2016, the Company had classified these assets under the head "Capital Work-in-progress" and the inventories of Rs.90.45 lakhs were included under current assets for the year ended March 31, 2016. The tangible assets were received by the company in the month of April 2016 and was subsequently installed and commissioned. These tangible assets have been capitalized during the year 2016-17.

(ii) The intangible assets comprising of Brands & Trademarks and Patents. Trademarks have been filed for registration in the name of the company. These intangible assets acquired in the business combination amounting to Rs.131.00 lakhs have been recognized separately from Goodwill at their fair value at the acquisition date (which is regarded as their cost).

(iii) Goodwill arising on the acquisition of Star Diamond Tools Private Limited amounting to Rs.10.27 lakhs has been recognized.

Impact of acquisition:-

In the financial year 2016-17, the company generated revenue of Rs.277.30 lakhs from this new business and anticipates good growth of revenues in the coming years. Included in the segment results of super abrasives, Rs. 20.08 lakhs attributable to the additional business generated on account of the acquisition of "Star Diamond Tools Private Ltd".

Note 11 - Financial Instruments

12 Capital Management

The capital includes issued equity share capital and all other equity reserves attributable to the equity holders. The Company''s objectives when managing capital is to safeguard their ability to continue as a going concern while maximizing the return to shareholders through the optimization of cash and cash equivalents along with investment which is predominantly investment in liquid and short-term mutual funds.

13 Categories of financial instruments

The carrying value and fair value of financial instruments by categories as of March 31, 2017, March 31, 2016 and April 1, 2015 were as follows:

The management assessed that fair value of cash and short- term deposits, trade receivables, trade payables, book overdrafts and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:

I) Long-term receivables are evaluated by the Company based on parameters such as interest rates, specific country risk factors, individual creditworthiness of the customer and the risk characteristics of the financed project. Based on this evaluation, allowances are taken into account for the expected losses of these receivables.

ii) The fair value of the quoted mutual funds is based on price quotations at reporting date. The fair value of unquoted instruments, loans from banks and other financial liabilities, as well as other non-current financial liabilities is estimated by discounting future cash flows using rates currently available for debtor similar terms, credit risk and remaining maturities.

Fair value hierarchy

Level 1 -Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2- Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e.as prices) or indirectly (i.e. Derived from prices).

Level 3- Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The following table presents the fair value measurement hierarchy of financial assets measured at fair value on recurring basis as at March 31,2017, March 31,2016 and April 1,2015.

Note 14Financial Risk management objectives and polices

The Company treasury function provides service to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the company through internal risk report which analyze exposures by degree and magnitude of risk. These risk include market risk, currency risk, credit risk and liquidity risk.

The Company seeks to minimize the effects of these risks by using policies approved by the board of directors, which provide written principles on interest risk, credit risk and investment of excess liquidity. The Company does notenter into trade financial instruments for speculative purpose.

The Company treasury function reports quarterly to the senior management team that monitors risk and policies implemented to mitigate risk exposures.

15 Market risk

The company is exposed primarily to the financial risk of change in foreign currency exchange rate. The Company transact into different foreign currencies. Foreign currencies are recognized at the rate of exchange prevailing at the date of transaction. Company being a net exporter, follows the policy of natural hedging of foreign exchange earnings. Net forex gains is always at positive side.

16 Foreign currency risk management

The company undertakes transactions denominated in foreign currencies, consequently, the company is exposed to exchange rate fluctuations. The company, being a net exporter, follows the policy of natural hedging of foreign exchange earnings and outflow and hence it does not take any forward covers.

The carrying amounts of the Company''s foreign currency (unhedged) denominated monetary assets and monetary liabilities at the end of the reporting period are as follows:

For the year ended March 31, 2017 and March 31, 2016, every 1 % increase / decrease of the respective foreign currencies compared to functional currency of the company would impact operating margins by 0.10% (0.10%) and 0.15% (0.15%) respectively.

17 Credit Risk

Credit risk is the risk that counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.

The customers are broadly classified into high risk and medium risk, accordingly credit limit exposure is fixed. The company carries out payment performance review of all customers and based on this analysis, risk category of customers are evaluated annually. Further, the utilization of credit limit is regularly monitored through inbuilt locks in the ERP system.

18 Liquidity Risk

Liquidity risk is the risk that the company will not be able to meet its financial obligations as they fall due. The company''s approach to managing liquidity is to ensure that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the company''s business and reputation.

The Company regularly reviews its receivables, inventory & other working capital elements to mitigate any liquidity concerns. Any surplus from the business funds needs is parked in debt mutual funds (liquid/liquid plus) from reputed AMCs to provide day today working capital.

Also, the company has unutilized credit limits with bank.

Note 19 - Segment Disclosure 44.1 Products and services from which reportable segments derive their revenue

The CEO of the Company has been identified as the Chief Operating Decision Maker (CODM) as defined by Ind AS 108, Operating Segments. Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the CODM, in deciding how to allocate resources and assessing performance.

1) The Company is organized into two main business segments, namely:

a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organization structure as well as the differing risks and returns of these segments. The Company has identified business segments as its primary segments. The reportable business segments are in line with the segment wise information which is being presented to the CODM.

2) Segment Assets and Segment Liabilities of the Company''s business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure relating to capital employed has not been given.

3) Revenues earned from the business combination is included in Super Abrasives segment. Revenues are earned both in India and Outside India.

20 Segment Revenues and Results

21 Information about major customers

No single customer represents 10% or more of the company''s total revenue for the year ended March 31, 2017 and March 31, 2016.

Note 22 - Leases

(a) The Company is obligated under cancelable operating leases towards residential accommodation, which are renewable at the option of both the lessor and the lessee. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs. 15.60 lakhs. (Previous year: Rs 14.10 lakhs).

There are no sub-lease payments received/receivable recognized in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

(b) The Company has leased out apportion of its factory building to a related party.

The lease agreement is for a period of 12 months and can be terminated by either party by giving one month notice.

The depreciation recognized in respect of the factory building for the year is Rs. 52.05 lakhs.

There are no contingent rents receivable.

Note23 - Employee Benefits

Defined Contribution Plans

The Company operates defined contribution benefit plans for all qualifying employees of the company.

Superannuation fund, Provident fund and pension fund are defined contribution plans towards which the company makes contribution at predetermined rates to the Superannuation Trust funded with Life Insurance Corporation Of India and the Regional Provident Fund Commissioner respectively. The same is debited to the Statement of Profit and Loss accounts based on the amount of contribution required to be made and services rendered by the employees.

Defined Benefit Plans

The Company is having defined benefit plan namely gratuity for all qualifying employees of the company.

The liability for gratuity to employees as at the Balance sheet date is determined on the basis of actuarial valuation using Projected Unit Credit method. The amount is funded to a Gratuity fund administered by the trustees and managed by Life Insurance Corporation of India. The liability thereof is paid and absorbed in the statement of profit and loss at the year end.

Remeasurement, comprising actuarial gain and losses and the return on plan assets (excluding net interest), is reflected immediately in the balance sheet with a charge or credit recognized in other comprehensive income in the period in which they occur. Remeasurement recognized in other comprehensive income is reflected in retained earnings and is not reclassified to profit or loss.

The plans typically expose the company to actuarial risks such as investment risk, interest rate risk, longevity risk and salary risk.

A. Gratuity

The following tables set out the funded status of the gratuity plans and the amounts recognized in the Company''s financial statements as at March 31, 2017 and March 31,2016:

Significant actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increase and mortality. The sensitivity analyses above have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant.

The sensitivity analysis presented above may not be representative of the actual changes in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet.

The Company expects to make a contribution of Rs. 29.69 lakhs (as at March 31, 2016: Rs.29.04 lakhs; as at April 1, 2015: Rs.26.29 lakhs) to the defined benefit plans during the next financial year. The employee benefit obligations (net) have been included in current liabilities based on the expected contributions.

B. Compensated Absences

(a) Charge to Statement of Profit and Loss and Liability

Note 24 - Related Party Transactions

1) List of Related parties:

i) Party with whom control exists -Subsidiaries

(a) Wendt Grinding Technologies Ltd, Thailand

(b) Wendt Middle East FZE, Sharjah

ii) Ventures to the joint venture with whom transactions have taken place during the year

(a) Carborundum Universal Limited (CUMI)

(b) Wendt GmbH Germany

iii) Company in which director is a director

(a) Ace Designers Ltd

(b) Pragati Transmission P Ltd

(c) Tespa Tools Pvt Ltd

iv) Key Management Personnel Mr.Rajesh Khanna, Chief Executive

v) Relatives of Key Management Personnel

Mrs. Preethi Khanna - Wife of Mr. Raiesh Khanna

Note 25 - Approval of financial statements

The financial statements were approved for issue by the board of directors on April 24, 2017.


Mar 31, 2016

Note 1. (iii)

Rights, Preferences and Restrictions attached to shares

The Company has only one class of equity shares with voting rights (one vote per share). The dividends proposed by the Board of directors is subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the equity shareholders are entitled to receive only the residual assets of the Company. The distribution of dividend is in the proportion to the number of equity shares held by the shareholders.

2.(11) SEGMENT DISCLOSURE

A) PRIMARY SEGMENT INFORMATION

Notes on Segment Information

3) The Company is organized into two main business segments, namely :

a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organization structure as well as the differing risks and returns of these segments. The Company has identified business segments as its primary segments.

4) Segment Assets and Segment Liabilities of the Company''s business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure relating to capital employed has not been given.

5.(13) Operating leases

a) The Company is obligated under cancelable operating leases towards residential accommodation, which are renewable at the option of both the lessor and the lessee. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs. 14.10lacs. (Previous year: Rs 12.00 lacs).

There are no sub-lease payments received/receivable recognized in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

b) The Company has leased out a portion of its factory building to a related party.

The lease agreement is for a period of 24 months and can be terminated by either party by giving one month notice.

6.(18)DETAILS OF ACQUISITION OF BUSINESS DURING THE YEAR

The Company has acquired the "Diamond Tool" business from Star Diamond Tools Private Limited at a consideration of Rs. 250 lacs, under slump sale on 29th March, 2016. The business transfer agreement excluded the immovable property, fixtures & fittings located at the factory, vehicles, cash and bank balance and computers and software of the seller company. Pending installation of the tangible assets and registration of the intangible assets as on March 31, 2016, the company has classified the assets under the head "Capital Work-in-Progress". The inventories have been included undercurrent assets.

7.(19)Previous year''s figures have been regrouped / reclassified wherever necessary to make them comparable with the current year''s classification /disclosure.


Mar 31, 2015

NOTE No.1

A COMPANY OVERVIEW

Wendt (India) Limited was incorporated on August 21st 1983 under the provisions of the erstwhile Companies Act,1956, and is a joint venture between Wendt GmbH Germany and Carborundum Universal Limited, India. Wendt (India) Limited is a leading manufacturer of Super Abrasives, High precision Grinding, Honing and Special Purpose Machines and High Precision components. The Company's registered office is in Bangalore and factory is situated in Hosur, Tamilnadu.

NOTE 2 - SHARE CAPITAL (Rs. in lacs)

Note 2 (iii)

Rights, Preferences and Restrictions attached to shares

The Company has only one class of equity shares with voting rights (one vote per share). The dividends proposed by the Board of directors is subject to approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the equity shareholders are entitled to receive only the residual assets of the Company. The distribution of dividend is in the proportion to the number of equity shares held by the shareholders.

NOTE

(a) The unclaimed dividend of Rs. 30.14 lacs represents those relating to the years 2007-08 to 2013-2014 and no part thereof has remained unpaid or unclaimed for a period of seven years from the date they became due for payment requiring transfer to the Investor Education and Protection Fund.

Note (i) :-Balance with banks includes Rs.10.52 lacs as deposits with remaining maturity of more than 12 months from the balance sheet date

Note (i)

The above excise duty relates to difference between the opening and closing stock of finished goods. The excise duty shown as deduction from sales in the statement of profit and loss represents excise duty on sales during the year.

Note - 3

NOTES FORMING PART OF THE FINANCIAL STATEMENTS ADDITIONAL INFORMATION TO FINANCIAL STATEMENTS

31.03.2015 31.03.2014

1 Contingent Liability and commitments to the extent not provided for:

1A Contingent Liabilities

a) Claims against the Company not acknowledged as debt: Disputed income 59.32 59.32 tax demands under appeal

The Company has received favourable orders from the Income Tax Appellate Tribunal (ITAT), in respect of two assessment years. In respect of one assessment year, the Company has received a favourable order from Commissioner of Income Tax - Appeals (CIT-A), but the order giving effect to the ITAT and CIT -A order is yet to be received by the Company.

The said amounts have been arrived at based on the assessment orders received from the relevant authority. Outflows, if any, arising out of this claim would depend on the outcome of the decision and the Company's rights for further appeal before the Judiciary.

1B Commitments

a) Estimated amount of contracts remaining to be executed on capital account 319.83 437.35

(in respect of tangible assets) and not provided for (net of advances Rs.40.39 lacs; previous year Rs.18.74 lacs)

b) Other Commitments

2 The Company has a working capital limit - - with State Bank of India, secured by hypothecation of stock and book debts and collateral charge on all fixed assets other than land and building. However, the Company has not utilized the said facility during the current / previous year.

3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Particulars 31.03.2015 31.03.2014

(I) Principal amount remaining unpaid to any supplier as at the end of the accounting year 45.60 43.22

(ii) Interest due thereon remaining unpaid to any supplier as at the end of the accounting year - -

(iii) The amount of interest paid along with the amounts of the payment made to the supplier beyond the appointed day - -

(iv) The amount of interest due and payable for the year - -

(v) The amount of interest accrued and remaining unpaid at the end of the accounting year - -

(vi) The amount of further interest due and payable even in the succeeding year, until such date when the interest dues as above are actually paid - -

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

4 During the year, pursuant to the notification of Schedule II to the Companies Act, 2013 with effect from April 1,2014, the Company has revised the depreciation to align to the useful life with those assets specified in Schedule II

The details of previously applied depreciation method, rate / useful life are as follows:

Pursuant to the transition provisions prescribed in Schedule II to the Companies Act, 2013, the Company has fully depreciated the carrying value of assets, net of residual value, where the remaining useful life of the asset was determined to be nil as on April 1,2014, and has adjusted an amount of Rs. 125.85 lacs (net of deferred tax of Rs. 64.80 lacs) against the opening Surplus balance in the Statement of Profit and Loss under Reserves and Surplus.

The depreciation expense in the Statement of Profit and Loss for the year is higher by Rs. 260.20 lacs consequent to the change in the useful life of the assets.

5. Employee Benefits I Defined Contribution Plans

During the year, the Company has recognized the following amounts in the Statement of Profit and Loss:

The estimate of future salary increases considered in actuarial valuation, is in respect of salary on which gratuity is payable and takes account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

A) Change in Present Value of Obligation :-

* The details with respect to the composition of investments in the plan assets have not been disclosed in the absence of the aforesaid information. Further, details of experience adjustments have not been disclosed in the absence of relevant information from the actuary.

The estimate of future salary increases considered in actuarial valuation, take account of infation, seniority, promotion and other relevant factors , such as supply and demand in the employment market.

6. SEGMENT DISCLOSURE

A) PRIMARY SEGMENT INFORMATION Notes on Segment Information

1) The Company is organised into two main business segments, namely : a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organisation structure as well as the differing risks and returns of these segments. The Company has identified business segments as his primary segments.

2) Segment Assets and Segment Liabilities of the Company's business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure relating to capital employed has not been given.

7 In accordance with Accounting Standard 18 'Related Party Disclosures', the Company has compiled the required information as detailed below.

1) List of Related parties

i) Party with whom control exists -Subsidiaries

a) Wendt Grinding Technologies Ltd, Thailand

b) Wendt Middle East FZE

ii) Venturers to the joint venture with whom transactions have taken place during the year

a) Carborundum Universal Limited (CUMI)

b) Wendt GmbH Germany

iii) Company in which director is a director

Ace Designers Ltd

iv) Key Management Personnel Mr.Rajesh Khanna, CEO

v) Relatives of Key Management Personnel

Mrs. Preethi Khanna - Wife of Mr. Rajesh Khanna

a) The related party relationships are as identified by the Company, on the basis of information available with the Company and relied upon by the auditors.

b) No amounts in respect of related parties have been written off / back other than any amount included above during the year.

c) Provision for diminution in value of investments in Wendt Middle East FZE Rs.76.56 lacs has been written back during the previous year.

8 Operating leases

a) The Company is obligated under cancelable operating leases towards residential accomodation, which are renewable at the option of both the lessor and the lessee. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs. 12.00 lacs. (Previous year: Rs 9.50 lacs).

There are no sub-lease payments received / receivable recognised in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

b) The Company has leased out a portion of its factory building to a related party.

The lease agreement is for a period of 24 months and can be terminated by either party by giving one month notice.

Note:- Revenue expenditure shown above includes Depreciation on R&D assets of Rs. 34.92 lacs (Previous year Rs. 20.74 lacs) & Consultancy Services of Rs. 81.15 lacs (Previous year Rs. 91.15 lacs).

9 Previous year's figures have been regrouped / reclassified wherever necessary to make them comparable with the current year's classification / disclosure.


Mar 31, 2014

Note - 1 31.03.2014 31.03.2013

1 Contingent Liability and commitments to the extent not provided for:

1A Contingent Liabilities

a) Claims against the Company not acknowledged as debt: Disputed income 59.32 59.32

tax demands under appeal

The Company has received favourable orders from the Income Tax Appellate Tribunal (ITAT), in respect of two assessment years. In respect of I one assessment year, the Company has received a favourable order from Commissioner of Income Tax - Appeals (CIT-A), but the order giving effect to the ITAT and CIT -A order is yet to be received by the Company.

The said amounts have been arrived at based on the assessment orders received from the relevant authority. Outflows, if any, arising out of this claim would depend on the outcome of the decision and the Company''s rights for further appeal.

1B Commitments

a) Estimated amount of contracts remaining to be executed on capital account I 437.35 565.11 (in respect of tangible assets) and not provided for (net of advances

Rs.18.74 lacs; previous year Rs.35.97 lacs)

b) Other Commitments - 75 00

2 The Company has a working capital limit with State Bank of India, secured by I hypothecation of stock and book debts and collateral charge on all fixed assets other than land and building. However, the Company has not utilized the said facility during the current / previous year.

3 Value of imports on CIF basis:

Raw Materials 2,262.15 1,930.35

Traded goods 102.26 119.28

Stores and Spare parts 86.47 81.92

Capital Goods 267.88 153.14

4 Expenditure in Foreign Currency

Royalty - 77.90

Technical consultancy fee 91.15 30.09

Travel 36.28 38.93

Commission - 8.31

Others 22.42 24.35

5 Earnings in Foreign exchange :

i) FO.B.Value of goods exported 2 338 29 1718 99

ii) Others. 298.00 34.14

6 Earning per share (EPS) is calculated as under

a) Numerator -

Profit for the year 1,186.81 1,011.83

b) Denominator - weighted average number of equity shares

Basic and diluted 2,000,000 2,000,000

c) Nominal value of shares (in rupees) 10 10 Earnings per share (in rupees)

Basic and diluted 59.34 50.59

7 Operating leases

a) The Company is obligated under cancelable operating leases towards residential accomodation, which are renewable at the option of both thelessor and the lesseeT. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs. 9.50 lacs. (Previous year: Rs 6.00 lacs).

There are no sub-lease payments received/receivable recognised in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

b) The Company has leased out a portion of its factory building to a related party.

The lease agreement is for a period of 11 months and can be terminated by either party by giving one month notice.

Details of the above referred lease are as given below:

Gross carrying amount 1,463.92

Less: Accumulated Depreciation 268.08

Net carrying amount 1,195.84

The depreciation recognized in respect of the factory building for the year is Rs. 44.18 lacs. There are no contingent rents receivable.

2. In accordance with Accounting Standard 18 ''Related Party Disclosures'', the Company has compiled the required information as detailed below.

1) List of Related parties

i) Party with whom control exists -Subsidiaries a Wendt Grinding Technologies Ltd, Thailand b Wendt Middle East FZE

ii) Venturers to the joint venture with whom transactions have taken place during the year a Carborundum Universal Limited (CUMI) b Wendt GmbH Germany

3. SEGMENT DISCLOSURE

A) PRIMARY SEGMENT INFORMATION Notes on Segment Information

1) The Company is organised into two main business segments, namely : a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organisation structure as well as the differing risks and returns of these segments. The Company has identified business segments as its primary segments.

4. Previous year''s figures have been regrouped / reclassified wherever necessary to make them comparable with the current year''s classification / disclosure.


Mar 31, 2013

A COMPANY OVERVIEW

Wendt (India) Limited was incorporated on August 21 st, 1983 under the provisions of the Companies Act, 1956, and is a joint venture between Wendt GmbH, Germany and Carborundum Universal Limited, India. Wendt (India) Limited is a leading manufacturer of Super Abrasives, High precision Grinding, Honing and Special Purpose Machines and High Precision components.The Company''s registered office is in Bangalore and factory is situated in Hosur, Tamilnadu.

1 Operating leases

The Company is obligated under cancelable operating leases towards residential accomodation, which are renewable at the option of both the lessor and the lessee. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs.6.00 lacs (Previous year: Rs 6.09 lacs). There are no sub-lease payments received/receivable recognised in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

2 In accordance with Accounting Standard 18 ''Related Party Disclosures'', the Company has compiled the required information as detailed below.

1) List of Related parties

i) Party with whom control exists -Subsidiaries a Wendt Grinding Technologies Ltd, Thailand b Wendt Middle East FZE, Sharjah

ii) Venturers to the joint venture with whom transactions have taken place during the year a Carborundum Universal Limited (CUMI) b Wendt GmbH Germany

3 SEGMENT DISCLOSURE

A) PRIMARY SEGMENT INFORMATION Notes on Segment Information

1) The company is organized into two main business segments, namely : a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organisation structure as well as the differing risks and returns of these segments. The Company has identified business segments as its primary segments.

2) Segment Assets and Segment Liabilities of the Company''s business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure relating to capital employed has not been given.

4. Previous year''s figures have been regrouped / reclassified wherever necessary to make them comparable with the current year''s classification / disclosure.


Mar 31, 2012

COMPANY OVERVIEW

Wendt (India) Limited was incorporated on August 21 st 1983 under the provisions of the Companies Act, 1956, and is a joint venture between Wendt GmbH, Germany and Carborundum Universal Limited, India. Wendt (India) Limited is a leading manufacturer of Super Abrasives, High precision Grinding, Honing and Special Purpose Machines and High Precision components.

31.03.2012 31.03.2011

1 Contingent Liability and commitments not provided for:

a) Disputed income tax demands under appeal 59.32 59.32 The company has received favourable orders from the Commissioner of Income Tax (Appeals) (CIT-A) in respect of two assessment years, however the department is in appeal with the Income Tax Appellate Tribunal. In respect of one assessment year, the Company has received a favourable order from CIT-A but the order giving effect to the CIT -A order is yet to be received by the Company.

The said amounts has been arrived at based on the assessment order received from the relevant authority. Outflows, if any, arising out of this claim would depend on the outcome of the decision and the Company's rights for further appeal before the Judiciary.

b) Guarantees given by Company's Bankers - 75.00

c) Bills Discounted 46.99 90.65

d) Estimated amount of contracts remaining to be executed on capital account 618.51 760.21 (in respect of tangible assets) and not provided for (net of advances Rs.48.05 lacs (previous year Rs.29.41 lacs)

e) Other commitments (in respect of goods and services) (net of advances of 180.98 22.94 Rs.47.86 lacs (previous year Rs.16.34 lacs)

2 The Company is having a working capital limit with State Bank of India, secured by hypothecation of stock and book debts and collateral charge on all fixed assets other than land and building. However, the Company has not utilized the said facility.

3 SEBI Disclosure requirement (as required under Clause 32 of the Listing Agreement)

Additional information to comply with SEBI disclosure requirement.

Loans and advances in the nature of loans to subsidiary

Wendt Middle East FZE, Sharjah 26.33 11.51

(Maximum amount outstanding Rs.81.51 lacs (previous year Rs.49.16 lacs))

4 Value of imports on CIF basis:

Raw Materials and Components 1,914.22 1,628.49

Traded goods 116.93 79.55

Stores and Spare parts 157.80 120.15

Capital Goods 562.94 167.13

5 Expenditure in Foreign Currency

Royalty 195.46 164.71

Travel 27.93 25.86

Commission 1.62 -

Others 1.67 2.43

6 Earnings in Foreign exchange :

i) F.O.B.Value of goods exported 1,946.43 1,446.02

ii) Others. 64.23 144.39

7 Earnings per share (EPS) is calculated as under

a) Numerator -

Net profit for the year 1,729.07 1,595.09

b) Denominator - weighted average number of equity shares Basic and diluted 2,000,000 2,000,000

c) Nominal value of shares (in rupees) 10 10 Earnings per share (in rupees)

Basic and diluted 86.45 79.76

8 Operating leases

The Company is obligated under cancelable operating leases towards residential accommodation, which are renewable at the option of both the lessor and the lessee. Total rental expense debited to the Statement of Profit and Loss under cancelable operating leases amounts to Rs.6.09 lacs (Previous year: Rs 5.32 lacs).

There are no sub-lease payments received/receivable recognized in the statement of profit and loss. Also, there are no contingent rents payable and there are no restrictions imposed by lease agreements such as those concerning dividends and additional debt.

9 In accordance with Accounting Standard 18 'Related Party Disclosures', the Company has compiled the required information as detailed below.

1) List of Related parties

i) Party with whom control exists -Subsidiaries a Wendt Grinding Technologies Ltd, Thailand

b Wendt Middle East FZE, Sharjah

ii) Venturers to the joint venture with whom transactions have taken place during the year a Carborundum Universal Limited (CUMI)

b Wendt GmbH, Germany

There are no outstanding derivative instruments as at the end of the year (previous year Rs.Nil)

10 SEGMENT DISCLOSURE

A) PRIMARY SEGMENT INFORMATION Notes on Segment Information

1) The company is organized into two main business segments, namely :

a) Super Abrasives and b) Machines, Accessories and Components.

The above segments have been identified taking into account the organization structure as well as the differing risks and returns of these segments.

2) Segment Assets, Segment Liabilities and Fixed Assets used in Company's business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure related to total carrying amount of segment assets, liabilities and fixed assets have not been given.

12. The Revised Schedule VI has become effective from 1st April 2011 for the preparation and presentation of the financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to make them comparable with the current year's classification / disclosure.


Mar 31, 2011

(Rs. in 000s)

31.03.2011 31.03.2010

A 1 Contingent Liability not provided for:

a) Disputed income tax demands under appeal 5,932 5,932 The company has received favourable orders from the Commissioner of Income Tax (Appeals) (CIT-A) in respect of two assessment years, however the department is in appeal with the Income Tax Appellate Tribunal. In respect of one assessment year, the Company has received a favourable order from CIT-A but the order giving effect to the CIT -A order is yet to be received by the Company.

The said amounts has been arrived at based on the assessment order received from the relevant authority. Outflows, if any, arising out of this claim would depend on the outcome of the decision and the Companys rights for further appeal before the Judiciary.

b) Guarantees given by Companys Bankers 18,551 6,313

c) Bills Discounted 9,065 1,990

2 The Company is having a working capital limit with State Bank of India, secured by hypothecation of stock and book debts and collateral charge on all fixed assets other than land and building.

3 During the year the Company, based on the Boards approval has converted loan given to Wendt Middle East FZE a subsidiary, into equity amounting to Rs.3,685 (000s). The Company has completed the necessary regulatory formalities in this regard. Accordingly the investment in the said subsidiary stands increased to Rs.15,316 (000s) from Rs.11,631 (000s)

4 There are no dues to Micro and Small Enterprises as per Micro, Small and Medium Enterprises Development Act 2006 which are outstanding for more than 45 days at the Balance Sheet date. The above information has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the auditors

5 The unclaimed dividend of Rs. 2,120 (000s) represents those relating to the years 2004 to 2010 and no part thereof has remained unpaid or unclaimed for a period of seven years from the date they became due for payment requiring transfer to the Investor Education and Protection Fund.

6 Deferred Tax

6.1 Notes

Tax provision has been made in accordance with the requirements under the Accounting Standard 22 "Accounting for Taxes on Income" as detailed below.

7 In accordance with Accounting Standard 18 Related Party Disclosures, the Company has compiled the required information as detailed below.

1) List of Related parties

I) Party with whom control exists -Subsidiaries

a Wendt Grinding Technologies Ltd

b Wendt Middle East FZE

ii) Venturers to the joint venture with whom transactions have taken place during the year

a Carborundum Universal Limited (CUMI)

b Wendt GmbH Germany

Transaction with related parties

a) The related party relationships are as identified by the Company, on the basis of information available with the Company and relied upon bytheauditors.

b) No amounts in respect of related parties have been written off/ back other than any amount included above during the year.

8. Employee Benefits

I Defined Contribution Plans

a. Provident Fund

b. Superannuation Fund

c. Employers Contribution to Employees State Insurance

d. Employers Contribution to Employees Pension Scheme 1995.

II Defined Benefit Plan

a) Contribution to Gratuity Fund :

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

9 Segment Disclosure

A) PRIMARY SEGMENT INFORMATION

Notes on Segment Information

1) The company is organised into two main business segments, namely:

a)Super Abrasives & b) Machines, Accessories and Components.

The above segments have been identified taking into account the organisation structure as well as the differing risks and returns of these segments.

2) Segment Assets, Segment Liabilities & fixed assets used in Companys business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure related to total carrying amount of segment assets, liabilities and fixed assets have not been given.

10 Previous years figures have been reclassified / regrouped wherever necessary to facilitate comparison with those for the current year


Mar 31, 2010

1 Contingent Liability not provided for:

31.03.2010 31.03.2009

a) Disputed income tax demands under appeal 59,32 59,32

b) Guarantees given by Companys Bankers 63,13 11,75

c) Bills Discounted LC 19,90 2,08



2 Micro and Small Enterprises as per the Micro , Small and Medium Enterprises Development Act 2006 have been identified by the company based on the information available with the company. This has been relied upon by the auditors. Based on such identification there are no dues outstanding to such parties for more than 45 days as at the Balance Sheet date.

3 The unclaimed dividend of Rs. 18,36 (000) represents those relating to the years 2003 to 2009 and no part thereof has remained unpaid or unclaimed for a period of seven years from the date they became due for payment requiring a transfer to the Investor Education and Protection Fund.

3.1 Notes

Tax provision has been made in accordance with the requirements under the Accounting Standard 22 “Accounting for Taxes on income " as detailed below.

4 In accordance with Accounting Standard 18 Related Party Disclosures , the Company has compiled the required information as detailed below.

1) List of Related parties

i) Party with whom control exists -Subsidiaries

a Wendt Grinding Technologies Ltd

b Wendt Middle East FZE

ii) Parties having significant influence with whom transactions have taken place during the year

a Carborundum Universal Limited (CUMI)

b Wendt GmbH Germany

a) The related party relationships are as identified by the Company, on the basis of information available with the Company and relied upon by the auditors.

b) No amounts in respect of related parties have been written off / back other than any amount included above during the year.

5. Employee Benefits

I Defined Contribution Plans

a. Provident Fund

b. Superannuation Fund

c. Employers Contribution to Employees State Insurance

d. Employers Contribution to Employees Pension Scheme 1995.

* Included in Contribution to provident and other funds (Refer Schedule 10)

II Defined Benefit Plan

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

* The details with respect to the composition of investments in the fair value of plan assets have not been disclosed in the absence of the aforesaid information.

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

6 Segment Disclosure

Segment Assets, Segment Liabilities & fixed assets used in Companys business have not been identified to any reportable segment, as these are used interchangeably between segments and hence segment disclosure related to total carrying amount of segment assets, liabilities and fixed assets have not been given.

7 Previous years figures have been reclassified regrouped wherever necessary to facilitate comparison with those for the current year.

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