Mar 31, 2018
Company Information:
Accel Transmatic Limited (the company) is a public limited company domiciled in India and is listed in the Bombay stock exchange (BSE). The company presently offers animation services and engineering services from its facilities in Trivandrum and Chennai. The Company, as part of its business operations is also in the process of development of its surplus land both freehold and leasehold at Trivandrum.
i) Lease Hold Land
Land under Fixed Assets includes Rs.67.60 lacs being the value of land allotted and possession handed over by KINFRA Film & Video Park (KINFRA), a Government of Kerala Undertaking to the Company for construction of building to house its operations for which the registration formalities are yet to be completed. As per the agreement with " the party ", the said land is on a 90 year lease and has to be developed within a period of 3 years from the date of allotment i.e. on or before 05.04.2010. The said land could not be developed within the time frame agreed on account of the difficult scenario being faced by the Animation Industry in general and the company in particular. KINFRA , in the meantime has changed the status of the SEZ from Animation to include IT/ITES also. This has been approved by the Ministry of Industries & Commerce vide its letter dated 7th February 2012 . The company is taking steps in consultation with KINFRA, to obtained a Co-developer status and develop the land.
ii.) Impairment of Assets
In the opinion of the management there is no impairment as on the date of the balance sheet in the value of the carrying cost of Intellectual Property Rights (IPR) of the company within the meaning of Accounting Standard - 28 on Impairment of Assets issued under Companies (Accounting Standards) Rules 2006, considering the revenue earning potential of the company and based on the estimated future cash flows upon crystallization of enquiries received by the company for the intellectual property rights carried in the books as intangible assets.
iii.) Fixed assets , capital work in progress & Inventory of intangible assets
The animation division of the company is engaged in the development of Animation contents, which can be under a service / co production contract or for creating its own IPR. The cumulative expenses incurred under co production and IPR creation activities are carried forward under capital work-in-progress, till the assets are ready for commercial exploitation. The expenses incurred under service contracts are carried forward as work in progress inventories till the milestone billing are achieved. As a result Rs. Nil (PY Nil)are carried forward in the Accounts as at the year end.
During the year under review Rs.7,32,052/- has been incurred towards developmental expense for Gandhipuram land location at Thiruvananthapuram. The Closing work in progress stands at Rs.17,41,666/-
iv.) Land & Building
a. During the year under review the Company has disposed of land and building at 75, Nelson Manickam Road, Aminjikari, Chennai 600 029. (Land area 8000 sqft and building 14,850 sq ft). The resultant profit arising out of this transaction is reflected in other income.
b. The company has created a mortgage on one office building, in favour of the bank, towards banking facilities extended by the bank, to a subsidiary company.
(i) Investments in subsidiary and associates are stated at cost using the exemption provided as per Ind AS 27 "Separate Financial Statements"
(ii) The investment includes investment in Accel Frontline Limited(AFL) an erstwhile subsidiary company, which became a subsidiary of the JV partner, CAC Holdings Corporation, Japan, (CAC) and as a part of this arrangement , the company had signed a Shareholders'' agreement with AFL and CAC and the company also had given certain Representations and Warranties and also given Indemnities. The JV Arrangement resulted in certain disputes in respect of Representation and Warranties and on account of litigation before NCLT as well as SIAC between parties , a settlement was arrived at between the Parties, warranting the company to transfer its balance holding in AFL, without any consideration, to a Trust during the financial year 2017-18, AFL being the beneficiary.
b. Terms / rights attached to equity shares Equity shares
The company has one class of equity shares having a par value of Rs. 2 each. Each shareholder is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts in proportion to their shareholding.
d. During the period of five years immediately preceding the date at which the Balance Sheet is prepared , the Company has not
- alloted fully paid up shares pursuant to contract without payment being received in cash.
- alloted fully paid up shares by way of bonus shares and
- brought back shares
Details of Security
(i) Asset Backed Loan
(a) The Asset Backed Loan (ABL) from bank is secured by equitable mortgage of Company''s immovable properties and corporate guarantee by the Company and personal guarantee by the Promoter Director. ABL has fully being repaid before close of year ended 31st March, 2018.
(b) Closure of Loans:
The Asset Backed Loans has been fully repaid on 06-11-2017 and the overdraft / loan was a availed form The Federal Bank Limited, RM Nagar, Chennai secured against fixed deposit of RS.1 Crore.
( c) Charge Creation:
The charge against Asset Backed Loan as per MCA database has been closed on 04-01-2018
(ii) HP Loan
The HP Loan is availed from Kotak Mahindra Prime and The Federal Bank Limited Secured against Vehicle purchased against the respective loan.
Dues to Micro , Small & Medium Enterprises
The company has initiated the process of identifying the suppliers who qualify under the definition of micro and small enterprises, as defined under the Micro, Small and Medium Enterprises Development Act 2006. Since no intimation has been received from the suppliers regarding their status under the said Act as at 31st March 2018 , disclosures relating to amounts unpaid as at the year end, if any, have not been furnished. In the opinion of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the Act is not expected to be material.
(i) Revenue from operations, computed in accordance with IndAS "Revenue", for the current year is not comparable with previous year since the same is net of Goods & Service Tax (GST) whereas excise duty form part of expenses in previous year and current year (upto 30th June, 2017) (Iby way of a Settlement Agreement and Release dated 15.03.2017, signed by and between the company, Accel Limited and other Promoters M/s. CAC Holdings Corporation, Japan and Accel Frontline Limited, a settlement has been arrived at wherein all the parties have withdrawn their disputes and the litigation and as a part of the settlement, the company had transferred its holding in Accel Frontline Limited to a Trust without any consideration, the beneficiary of which will be Accel Frontline Limited. The accounts includes loss on disposal of shares amounting to Rs.7,38,33,247/-which has been shown under Exceptional Items.
2.Tax Expenses
Provision for current tax is made on the basis of the assessable Income and /or Mat Provisions, at the tax rate applicable to the relevant assessment year. No tax provision is made under normal as well under MAT considering the brought forward losses of the company as a whole. The deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have been enacted or substantively enacted by the Balance Sheet date The net Deferred Tax Asset at the year end is not recognized as a matter of prudence.
Sensitivity Analysis
Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and mortality. The sensitivity analysis below have been determined based on reasonably possible changes of the assumptions occurring at the end of the reporting period, while holding all other assumptions constant. The results of sensitivity analysis is given below:
3. Dividend
The Board of directors of the Company in its meeting held on 30th May 2018 has declared an interim dividend of 20% (Rs.0.40 per equity share) to equity shareholders amounting to Rs.22,802,960.40 and the same will be paid out of the profits of the company for the year ending 31st March 2018 subject to DDT.
4. Financial risk management
The company presently offers animation services and engineering services from its facilities in Trivandrum and Chennai. The Company, as part of its business operations is also in the process of development of its surplus land in the factory area located at Sreekariyam, Trivandrum.
The company has exposure to the following risks:
(1) Credit Risk
(2) Liquidity Risk
(3) Market Risk
(1) Credit Risk
Credit risk is a risk that counter party will not meet its obligation under the financial instrument or customer contract leading to financials loss. This risk consists primarly of default being experienced in trade receivables. The Company has provided for expected losses and hence there is no significant credit risk to the company. Before accepting any new customer, Company asses the potential customer''s credit quality.
(2) Liquity Risk
Refers to risk the company cannot meet its financial obligations. Since the Company has access to Varity sources of funding and is also continuously monitoring actual cash flows, this is not a significant risk to the company.
(3) Market Risk
Market risk is that the fair value of the future cash flows of financials instrument will fluctuate because of changes in market price. However this is not a significant risk since the company has provided in the books the fluctuation in market price of financial instruments as on the date of balance sheet for Mutual Funds.
5. GENERAL
The comparative financial information of the Company for the year ended 31 March 2017 and the transition date opening balance sheet as at 01 April 2016 included in these Standalone Ind AS Financial Statements, are based on the previously issued Statutory Financial Statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditor whose report for the year ended 31 March 2017 and 31 March 2016 dated 25 May 2017 and 14 July 2016 respectively expressed an unmodified opinion on those Standalone Financial Statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by statutory auditors.
Mar 31, 2015
1. Rights, preferences and restrictions attached to shares Equity
shares
The company has one class of equity shares having a par value of Rs, 10
each. Each shareholder is eligible for one vote per share held. In the
event of liquidation, the equity shareholders are eligible to receive
the remaining assets of the company after distribution of all
preferential amounts in proportion to their shareholding. Preference
Shares
The company had issued 5,000,000 10% Cumulative Redeemable Preference
Shares of a face value of Rs.10/- to the promoter company Accel Limited
aggregating to Rs.50,000,000/-on August 14, 2013 against loan amount
outstanding due to that Company as on that day. The Issue was approved
by the share holders in the AGM held on August 14, 2013. The shares are
redeemable after 7 years of the date of issue.
2. Details of Security
The Asset Backed Loan (ABL) from bank is secured by equitable mortgage
of Company's immovable properties and corporate guarantee of its
holding company M/s Accel Limited and personal guarantee of Mr N R
Panicker, Promoter Director.
3. Terms of repayment
Asset Backed Loan (ABL) from bank carries interest @ 12.70% p.a and the
amount outstanding as on date of balance sheet is repayable in 83
monthly instalments. The terms of repayment of loan from Holding
Company is not stipulated yet.
4. Dyes to Micro, Small & Medium Enterprises
The company has initiated the process of identifying the suppliers who
qualify under the definition of micro and small enterprises, as defined
under the Micro, Small and Medium Enterprises Development: Act: 2006.
Since no intimation has been received from the suppliers regarding
their status under the said Act as at 31st March 2015, disclosures
relating to amounts unpaid as at the year end, if any, have not been
furnished. In the opinion of the management, the impact of interest, if
any, that may be payable in accordance with the provisions of the Act:
is not expected to be material.
5. Capital Advance represents consideration received from an
associated concern as advance towards proposed utilisation of
infrastructural facilities situated at leased premises in KINFRA,
Trivandrum. Since the proposal is at the intial stage and the approval
from authorities is awaited, no adjustment is made in the book of
accounts for the assets proposed to be so transferred as per
arrangement.
6. Revaluation
The company has revalued its land and buildings at Trivandrum during
the year ended 31.03,2004, at the fair values determined by an
independent external valuer. The valuer determined the fair value by
reference to market-based evidence.
The revaluation resulted in an increase in the value of freehold land
and building by Rs. 1,09,39,354 and Rs.17,50,486, respectively. The
revaluation of the building results an additional depreciation charge
of Rs.58,466 every year. In accordance with the option given in the
Guidance Note on Accounting for Depreciation in Companies, the company
recoups such additional depreciation out of revaluation reserve.
7. Lease Hold Land
Land under Fixed Assets includes Rs.67.60 lacs being the value of land
allotted and possession handed over by KIN FRA Film & Video Park (KIN
FRA), a Government of Kerala Undertaking to the Company for
construction of building to house its operations for which the
registration formalities are yet to be completed. As per the agreement:
with" the party", the said land Is on a 90 year lease and has to be
developed within a period of 3 years from the date of allotment i.e. on
or before 05.04.2010,. The said land could not be developed within the
time frame agreed on account of the difficult scenario being faced by
the Animation Industry in general and the company in particular. KIN
FRA , in the meantime has changed the status of the SEZ from Animation
to include IT/ITES also., This has been approved by the Ministry of
Industries & Commerce vide its letter dated 7th February 2012 . The
company's proposal to KIN FRA to change our status to a co developer is
still pending.
8. Fixed assets, capital work in progress & Inventory of intangible
assets
The animation division of the company Is engaged In the development of
Animation contents, which can be under a service / co production
contract or for creating its own IPR. The cumulative expenses incurred
under co production and IPR creation activities are carried forward
under capital work-in-progress, till the assets are ready for
commercial exploitation. The expenses incurred under service contracts
are carried forward as work in progress inventories till the milestone
billing are achieved. As a result Rs. Nil (PY Rs.5,14,00)are carried
forward in the Accounts as at the year end.
8. Impairment of Assets
In the opinion of the management there is no impairment as on the date
of the balance sheet in the value of the carrying cost of fixed assets
of the company within the meaning of Accounting Standard - 28 on
Impairment of Assets issued under Companies (Accounting Standards)
Rules 2006, considering the revenue earning potential of the company
and based on the estimated future cash flows upon crystallization of
enquiries received by the company for the intellectual property rights
carried In the books as intangible assets.
9 Exceptional Item
The Company has adopted the revised estimates of useful life of Fixed
Assets as stipulated in Schedule II of the Companies Act 2013 w.e.f 1st
April 2014. The additional depreciation on such adoption has been
charged to Statement of Profit & Loss which is not material. Further,
an amount of Rs.51,74,084/- is charged to Revenue as exceptional Item
being value of assets for which the useful! life hasexpired as on 1st
April 2014 asa resuit of such change.
10. Taxation:
Provision for current tax is made on the basis of the assessable Income
and /or Mat: Provisions, at the tax rate applicable to the relevant
assessment year. Mo tax provision is made under normal as well under
MAT considering the brought forward losses of the company as a whole.
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date The net Deferred Tax Asset at the
year end is not recognized as a matter of prudence.
11. Related Party Disclosures Controlling Company Accel Limited
Associates
Accel Frontline Limited
Accel IT Resources Limited
Key Management Personnel:
N R Panleker Non Executive Chairman
K R Chandrasekaran Executive Director
Shoba Giridharan Company Secretary
12. Segment Reporting
The Company is engaged in the business providing animation services
which is considered to be the only reportable business segment as per
the Accounting Standard 17.
Previous year's figures have been regrouped , recasted and rearranged
wherever necessary, to suit the current period layout.
13.Merger
The Board of Directors of the Company, in its meeting held on 27th
March 2015 has approved a proposai for merger of the holding company
M/s Accel Limited, with the company w.e.f 1st April 2014 (Appointed
Date) subject to necessary statutory and other approvals. Accordingly,
a scheme of amalgamation has been drawan up and submitted to BSE Ltd.,
(Stock Exchange), which is pending for their approval. Necessary
adjustment in tha accounts would be incorported on approval of the
scheme by appropriate authorities.
Mar 31, 2014
1. Measurement of EBITDA
As permitted by the Guidance Note on the Revised Schedule VI to the
Companies Act, 1956, the company has elected to present earnings before
interest, tax, depreciation and amortization (EBITDA) as a separate
line item on the face of the statement of profit and loss. The company
measures EBITDA on the basis of profit/(loss) from continuing
operations. In its measurement, the company does not include
depreciation and amortization expense, finance costs and tax expense.
2. Rights, preferences and restrictions attached to shares Equity
shares
The company has one class of equity shares having a par value of Rs. 10
each. Each shareholder is eligible for one vote per share held. In the
event of liquidation, the equity shareholders are eligible to receive
the remaining assets of the company after distribution of all
preferential amounts in proportion to their shareholding.
3. Preference Shares
The company had issued 5,000,000 10% Cumulative Redeemable Preference
Shares to the promoter company Accel Limited, With a face value of Rs.
10/- aggregating to Rs.50,000,000/- on 27-09-2013 against loan amount
outstanding due to that Company as on that day. The Issue was approved
by the share holders in the AGM held on August 14, 2013. The shares are
redeemable after 7 years after the date of issue.
4. Going concern
The company has suffered cash losses from its operations during the
year. The accumulated losses as on the date of the balance sheet is
more than 50% of its net worth. However, considering the expected
future cash flows from the business and the intellectual property that
the company is currently exploiting through global sales, the
management is of the opinion that the company would be in a position to
continue as a going concern and hence the accounts have been drawn up
on such basis.
5.1: Details of Security : The Asset Backed Loan (ABL) from bank is
secured by equitable mortgage of Companies immovable properties and
corporate guarantee of its holding company M/s Accel Limited and
personal guarantee of Mr N R Panicker, Promoter Director.
5.2: Terms of repayment: loans from related party carry an interest of
7.50% for the holding company and 13.75% for other associate companies
and are repayable as per the loan agreement. ABL from bank carries
interest @ 12.85% p.a and the amount outstanding as on the date of
balance sheet is repayable in monthly installment over the next 83
months form the date of sanction.
6. Long term Provisions
a) Disclosure required under AS15 - "Employee Benefits" (Revised 2005)
1. Defined Contribution Plan
During the year, the company has recognized in the Profit and Loss
Account, an amount of Rs. 1,84,660 (Previous Year Rs. 286,959) on
account of defined contribution towards Provident Fund and Rs.
(Previous Year 35,371) towards Employees State Insurance Scheme.
2. Defined Benefit Plans
Gratuity - Funded Obligation
The assumption of future salary increases takes into account of
inflation, seniority, promotions and other relevant factors such as
supply and demand in the employment market.
Note: The above disclosures and the break up of liability into long
term and short term are based on valuation report of an independent
actuary and relied upon by the auditors.
3. Long Term Employee benefits
Compensated absences (Leave encashment) - Unfunded Obligation
The assumption of future salary increases takes into account of
inflation, seniority, promotions and other relevant factors such as
supply and demand in the employment market.
Note: The above disclosures and the break up of liability into long
term and short term are based on valuation report of an independent
actuary and relied upon by the auditors.
7. Short term borrowings
The Cash Credit limits, Term Loan Limits and Non Funded Limits (The
Limits) are secured by hypothecation of Intellectual property rights,
receivables and hypothecation of assets created out of bank finance and
carries interest @ 17.50% p.a and are repayable on demand.
The Limits are also secured by equitable mortgage of company''s
immovable properties at Trivandrum & Chennai
The limits are further secured by assignment of lease deposit in favour
of the bank in respect of leased property at Trivandrum. The loans are
also secured by a corporate guarantee of Accel Limited and pledge of
7,50,000 equity shares of Accel Transmatic Limited held by Accel
Limited, the holding company. Also refer note 5.3
The above loans were closed on 24-01-2014 after availing an Asset
Backed Loan (ABL) (Refer Note 5.1 above)
8. Dues to Micro, Small Enterprises
The company has initiated the process of identifying the suppliers who
qualify under the definition of micro and small enterprises, as defined
under the Micro, Small and Medium Enterprises Development Act 2006.
Since no intimation has been received from the suppliers regarding
their status under the said Act as at 31st March 2014, disclosures
relating to amounts unpaid as at the year end, if any, have not been
furnished. In the opinion of the management, the impact of interest, if
any, that may be payable in accordance with the provisions of the Act
is not expected to be material.
9. Other Current Liabilities
Note :
i. Advances received includes Security deposit including interest
accrued received from an associate company amounting to Rs. 16,246,726
(P.Y 23,771,806).
ii. Unclaimed dividend will be transferred to the Investor Protection
and Education Fund if remains unclaimed, in the year 2014-15.
10.1. Revaluation
The company has revalued its land and buildings at Trivandrum during
the year ended 31.03.2004, at the fair values determined by an
independent external valuer. The valuer determined the fair value by
reference to market-based evidence.
The revaluation resulted in an increase in the value of freehold land
and building by Rs. 1,09,39,354 and Rs. 17,50,486, respectively. The
revaluation of the building results an additional depreciation charge
of Rs. 58,466 every year. In accordance with the option given in the
Guidance Note on Accounting for Depreciation in Companies, the company
recoups such additional depreciation out of revaluation reserve.
10.2: Lease Hold Land
Land under Fixed Assets includes Rs.67.60 lacs being the value of land
allotted and possession handed over by KINFRA Film & Video Park
(KINFRA), a Government of Kerala Undertaking to the Company for
construction of building to house its operations for which the
registration formalities are yet to be completed. As per the agreement
with "the party" the said land is on a 90 year lease and has to be
developed within a period of 3 years from the date of allotment i.e. on
or before 05.04.2010. The said land could not be developed within the
time frame agreed on account of the difficult scenario being faced by
the Animation Industry in general and the company in particular.
KINFRA, in the meantime has changed the status of the SEZ from
Animation to include IT/ITES also. This has been approved by the
Ministry of Industries & Commerce vide its letter dated 7th February
2012. The company''s proposal to KINFRA to change our status to a co
developer is still pending.
10.3: Fixed assets, capital work in progress & Inventory of
intangible assets
The animation division of the company is engaged in the development of
Animation contents, which can be under a service /coproduction contract
or for creating its own IPR. The cumulative expenses incurred under
coproduction and IPR creation activities are carried forward under
capital work-in-progress, till the assets are ready for commercial
exploitation. The expenses incurred under service contracts are carried
forward as work in progress inventories till the milestone billing are
achieved. The following amounts are carried forward in the Accounts as
at the year end.:-
1. Under Fixed Assets & Capital work in progress (net of amortization)
Rs. 74,788,047 (Previous year Rs. 98,792,490)
10.4: Impairment of Assets
In the opinion of the management there is no impairment as on the date
of the balance sheet in the value of the carrying cost of fixed assets
of the company within the meaning of Accounting Standard - 28 on
Impairment of Assets issued under Companies (Accounting Standards)
Rules 2006, considering the revenue earning potential of the company
and based on the estimated future cash flows upon crystallization of
enquiries received b the company for the intellectual property rights
carried in the books as intangible assets.
The confirmation of balances from concerned parties in respect of major
accounts of sundry debtors, other receivables, loans and advances and
sundry creditors outstanding as at the year-end is yet to be received.
This also includes the revenue entitlement on the international
recoupment on one of its coproduction work completed.
11. Trade Receivables
Th confirmation of balances from concerned parties in respect of major
accounts of sundry debtors, other receivables, loans and advances and
sundry creditors outstanding as at the year-end is yet to be received.
This also inclueds the revenue entitlement on the international
recoupment on one of its production work completed.
12. Other current assets
1) In the opinion of the Directors, the current assets, loans and
advances have the value in which they are stated in the balance sheet,
if realized in the ordinary course of business.
2) Unbilled revenue represents amount recognized based on services
performed in advance of billing in accordance with contractual terms.
13. Exceptional items
During the previous year, The Company sold its Technology division
(''transferred division'') along with its subsidiary in United States of
America to Accel Frontline Limited, pursuant to a Business transfer
agreement w.e.f. August 15th, 2011 on a slump sale basis for a cash
consideration of Rs. 19.97 crores. The transaction was approved by the
Board of Directors on its meeting held on August 2nd, 2011. The profit
on sale of business of Rs. 1405.55 Lacs was credited to Profit and Loss
account as exceptional item.
As per the terms of the BTA to transfer the Technology division to
Accel Frontline Limited, the company received an additional amount of
Rs. 2 Crores as incentive on achievement of an EBITDA of Rs. 5 crores
for the twelve months ended 31st March 2012 as finalized by the audited
accounts of the said division.
Capitalization of expenditure
During the previous year, the company has capitalized certain expenses
to the cost of fixed asset classified under intangible assets/capital
work-in-progress (CWIP) being the expenses relatable to development of
such assets. Consequently, expenses disclosed under the respective
notes are net of amounts capitalized by the company. During the current
year there is no such capitalization.
Taxation:
Provision for current tax is made on the basis of the assessable Income
and/or Mat Provisions, at the tax rate applicable to the relevant
assessment year. No tax provision is made under normal as well under
MAT considering the brought forward losses of the company as a whole.
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date The net Deferred Tax Asset at the
year end is not recognized as a matter of prudence.
Related Party Disclosures
Controlling Company - Accel Limited
Associates
Accel Frontline Limited
Accel IT Resources Limited
Key Management Personnel:
N R Panicker Non-Executive Chairman
K R Chandrasekaran Executive Director
S T Prabhu Company Secretary
Contingencies and commitments
(Rupees in Lacs)
March 31, March 31,
2014 2013
Outstanding bank guarantees/letter of Credits 1.10 1.10
Corporate Guarantee to a bank on behalf of an
Associate Company - 350.00
Income Tax Demands 136.11 136.11
Customs 33.87 33.87
PF & Others 21.07 21.07
Estimated amount of Contracts remaining to be executed on Capital
account and not provided for (Net of Advances) is Rs. Nil Lacs
(Previous year Rs. Nil Lacs)
It is not practicable for the company to estimate the timings of cash
flows, if any, in respect of the above pending resolutions of the
respective proceedings. The company does not expect any reimbursement
from third parties in respect of the above contingent liability.
Additional Information pursuant to Part II of Schedule VI of the
Companies Act, 1956, to the extent applicable.
(a) Number of Non Resident Shareholders and dividends paid to them. (On
payment basis)
Previous year''s figures have been regrouped, re-casted and rearranged
wherever necessary, to suit the current period layout. Vide our report
of even date.
Mar 31, 2013
Company Information:
Accel Transmatic Limited (the company) is a public limited company
domiciled in India and is listed in the Bombay stock exchange (BSE).
The company presently ofers animation services from its studios in
Chennai and Trivandrum.
1.1 Rights, preferences and restrictions attached to shares
Equity shares
The company has one class of equity shares having a par value of Rs. 10
each. Each shareholder is eligible for one vote per share held. In the
event of liquidation, the equity shareholders are eligible to receive
the remaining assets of the company after distribution of all
preferential amounts in proportion to their shareholding.
Preferential warrants
The company had issued 5,50,000 convertible warrants to a subscriber (
non promoter ) for a face value of Rs. 10/- each at a price of Rs 30.30
aggregating to Rs.16,665,000/- on December 31, 2010. The subscriber has
remitted Rs. 41,66,250 being 25% of the issue consideration. The Issue
was approved by the share holders in the EGM held on December 17, 2010.
As per the terms of the issue, each of these warrants are to be
converted into one Equity share of Rs. 10/- each at a price of Rs.30.30
each within a period of 18 months from the date of issue of warrants at
the option of the subscriber. The subscriber did not exercise the
option for such conversion before June 30, 2012 and hence the amount
remitted has been forfeited and transferred to Reserves and Surplus
account.
2.1. Details of Security : The term loan from bank is secured by
hypothecation of assets acquired out of that loan. The limits are
further secured by assignment of lease deposit in respect of leased
property at Trivandrum in favour of the bank. The loans are also
secured by a corporate guarantee of Accel Limited and pledge of
7,50,000 equity shares of Accel Transmatic Limited held by Accel
Limited, the holding company.
2.2 Terms of repayment: loans from related party carry an interest of
7.50% for the holding company and 13.75% for other associate companies
and are repayable in monthly installments of Rs. 500,000 . Term loan
from bank carries interest @ 17.50% p.a and the amount outstanding as
on the date of balance sheet is repayable in quarterly installment of
Rs 72,00,000 Public deposit carries interest @11% pa (P.Y 11%), and are
repayable after 3 years from the respective dates of acceptance of
deposits.
2.3. During the previous year the company had sold its technology
division to Accel Frontline Limited (AFL ). As per the terms of the
agreement the net assets of the division has been transferred to AFL
including the Term Loan & Cash Credit accounts with State Bank of India
pertaining to the division. However the confrmation received from the
bank includes the loans pertaining to the transferred division
amounting to Rs. 20,012,032.43 pending transfer of the loan & Cash
credit limit allocated to the technology division of AFL by the bank.
The company is pursuing with the bank for the transfer.
2.4 The company had defaulted in the payment of installments and
interest in respect of the secured loans taken from bank and
installment in respect of unsecured loans taken from holding and
associate companies. The details of the same are as under.
3.1 Dues to Micro, Small Enterprises
The company has initiated the process of identifying the suppliers who
qualify under the defnition of micro and small enterprises, as defned
under the Micro, Small and Medium Enterprises Development Act 2006.
Since no intimation has been received from the suppliers regarding
their status under the said Act as at 31st March 2013, disclosures
relating to amounts unpaid as at the year end, if any, have not been
furnished. In the opinion of the management, the impact of interest, if
any, that may be payable in accordance with the provisions of the Act
is not expected to be material.
4.1 Advances received includes Security deposit including interest
accrued received from an associate company for providing a corporate
guarantee to a bank amounting to Rs. 23,771,806 (P.Y 25,268, 776) .
4.2 Unclaimed dividend will be transferred to the Investor Protection
and Education Fund if remains unclaimed, in the year 2013-14 & 2014-15
respectively.
4.3 Revaluation
The company has revalued its land and buildings at Trivandrum during
the year ended 31.03.2004, at the fair values determined by an
independent external valuer. The valuer determined the fair value by
reference to market-based evidence.
The revaluation resulted in an increase in the value of freehold land
and building by Rs. 1,09,39,354 and Rs.17,50,486, respectively. The
revaluation of the building results an additional depreciation charge
of Rs.58,466 every year. In accordance with the option given in the
Guidance Note on Accounting for Depreciation in Companies, the company
recoups such additional depreciation out of revaluation reserve.
4.4 Lease Hold Land
Land under Fixed Assets includes Rs.67.60 lacs being the value of land
allotted and possession handed over by KINFRA Film & Video Park
(KINFRA), a Government of Kerala Undertaking to the
Company for construction of building to house its operations for which
the registration formalities are yet to be completed. As per the
agreement with " the party ", the said land is on a 90 year lease and
has to be developed within a period of 3 years from the date of
allotment i.e. on or before 05.04.2010,. The said land could not be
developed within the time frame agreed on account of the difcult
scenario being faced by the Animation Industry in general and the
company in particular. KINFRA , in the meantime has changed the status
of the SEZ from Animation to include IT/ITES also., This has been
approved by the Ministry of Industries & Commerce vide its letter dated
7th February 2012 . The company has submitted its proposal to KINFRA to
change our status to a co developer.
5.1 Fixed assets , capital work in progress & Inventory of intangible
assets
The animation division of the company is engaged in the development of
Animation contents, which can be under a service / co production
contract or for creating its own IPR. The cumulative expenses incurred
under co production and IPR creation activities are carried forward
under capital work-in-progress, till the assets are ready for
commercial exploitation. The expenses incurred under service contracts
are carried forward as work in progress inventories till the milestone
billing are achieved. The following amounts are carried forward in the
Accounts as at the year end.:- 1. Under Fixed Assets & Capital work in
progress (net of amortization) Rs.98,792,490 ( Previous year Rs.
130,414,971 )
5.2 Impairment of Assets
In the opinion of the management there is no impairment as on the date
of the balance sheet in the value of the carrying cost of fxed assets
of the company within the meaning of Accounting Standard  28 on
Impairment of Assets issued under Companies (Accounting Standards)
Rules 2006, considering the revenue earning potential of the company
and based on the estimated future cash fows upon crystallization of
enquiries received b the company for the intellectual property rights
carried in the books as intangible assets.
Note 6 : Exceptional items
During the previous year , The Company sold its Technology division
(Âtransferred division'') along with its subsidiary in United States of
America to Accel Frontline Limited, pursuant to a Business transfer
agreement w.e.f. August 15th, 2011 on a slump sale basis for a cash
consideration of Rs.19.97 crores. The transaction was approved by the
Board of Directors on its meeting held on August 2nd, 2011.. The proft
on sale of business of Rs. 1405.55 Lacs was credited to Proft and Loss
account as exceptional item.
As per the terms of the BTA to transfer the Technology division to
Accel Frontline Limited, the company received an additional amount of
Rs. 2 Crores as incentive on achievement of an EBITDA of Rs. 5 crores
for the twelve months ended 31st March 2012 as fnalized by the audited
accounts of the said division.
Note 7 Other Notes
7.1 Capitalization of expenditure
During the year, the company has capitalized the following expenses to
the cost of fxed asset classifed under intangible assets/ capital
work-in-progress (CWIP) being the expenses relatable to such assets.
Consequently, expenses disclosed under the respective notes are net of
amounts capitalized by the company.
7.2 Taxation:
Provision for current tax is made on the basis of the assessable Income
and /or Mat Provisions, at the tax rate applicable to the relevant
assessment year. No tax provision is made under normal as well under
MAT considering the brought forward losses of the company as a whole.
The deferred tax asset and deferred tax liability is calculated by
applying tax rate and tax laws that have been enacted or substantively
enacted by the Balance Sheet date The net Deferred Tax Asset at the
yearend amounts to Rs 14,235,609/- (Previous Year Asset Rs.
84,54,064/-) and is not recognized as a matter of prudence.
7.3 Related Party Disclosures
Controlling Company  Accel Limited
Subsidiaries & Associates under common control :
Accel Frontline Limited Accel IT Resources Limited Accel Media Ventures
Limited
Key Management Personnel:
N R Panicker Non Executive Chairman
Philip John Whole time Director Resigned WEF 14.08.2012
S T Prabhu Director WEF 14.08.2012
7.4 Contingencies and commitments
(Rupees in Lacs)
March 31,
2013 March 31, 2012
Outstanding bank guarantees /
letter of Credits 1.10 1.10
Corporate Guarantee to a bank on
behalf of an Associate Company @ 350.00 350.00
Income Tax Demands 136.11 135.95
Customs 33.87 33.87
PF & Others 21.07 26.87
@ The corporate guarantee was given to a bank for the limits enjoyed by
an associate company, Accel IT Resources Limited while it was a
subsidiary . This is backed by an interest bearing cash deposit of Rs.
230 Lakhs from the said company which is more than the exposure of that
company with the bank as on the date of the balance sheet..
Estimated amount of Contracts remaining to be executed on Capital
account and not provided for (Net of Advances) is Rs. Nil Lacs
(Previous year Rs.Nil Lacs)
It is not practicable for the company to estimate the timings of cash
fows, if any, in respect of the above pending resolutions of the
respective proceedings. The company does not expect any reimbursement
from third parties in respect of the above contingent liability.
Previous year''s fgures have been regrouped , recasted and rearranged
wherever necessary, to suit the current period layout.
Mar 31, 2012
Company Information:
Accel Transmatic Limited (the company) is a public limited company
domiciled in India and is listed in the Bombav stock exchange (BSE).
The company presently offers anima- tion services from its studios in
Chennai and Trivandrum.The company had demerged its technology business
to its group company M/s Accel Frontline Limited (AFL) effective August
15,2011 (refer note 23)
1.1 Measurement of EBITDA
As permitted by the Guidance Note on the Revised Schedule VI to the
Companies Act, 1956, the company has elected to present earnings before
interest, tax, depreciation and amortization (EBITDA) as a separate
line item on the face of the statement of profit and loss. The company
measures EBITDA on the basis of profit/ (loss) from continuing
operations. In its measurement, the company does not include
depreciation and amortization expense,finance costs and tax expense.
1.2 Presentation and disclosure of financial statements
During the year ended 31 March 2012, the revised Schedule VI notified
under the Companies Act 1956, has become applicable to the company, for
preparation and presentation of its financial statements. The adoption
of revised Schedule VI does not impact recognition and measurement
principles followed for preparation of financial statements. However,
it has significant impact on presentation and disclosures made in the
financial statements.The company has also reclassified the previous
year figures in accordance with the requirements applicable in the
current year.
2.1 Rights, preferences and restrictions attached to shares Equity
shares
The company has one class of equity shares having a par value of Rs. 10
each. Each shareholder is eligible for one vote per share held. The
dividend proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing Annual General Meeting, except in
case of an interim dividend. In the event of liquidation, the equity
shareholders are eligible to receive the remaining assets of the
company after distribution of all preferential amounts in proportion to
their shareholding.
Preferential warrants
The company had issued 5,50,000 convertible warrants to a subscriber
(non promoter) for a face value of Rs. 10/- each at a price of Rs 30.30
aggregating to Rs.16,665,000/- on December 31, 2010. The subscriber has
remitted Rs. 41,66,250 being 25% of the issue consideration. The Issue
was approved by the share holders in the EGM held on December 17,2010.
As per the terms of the issue, each of these warrants are to be
converted into one Equity share of Rs. 10/- each at a price of Rs.30.30
each within a period of 18 months from the date of issue of warrants at
the option of the subscriber. In case the subscriber does not exercise
the option for such conversion within the prescribed period, the amount
paid for, will be forfeited.The option has to be exercised on or before
June 30, 2012.
3.1 Going concern
The company has suffered cash losses from its operations during the
year, without considering the profit on transfer of its technologies
division. The accumulated losses as on the date ofthe balance sheet is
more than 50% of its net worth. However, considering the expected
future cash flows from the business and the intellectual property that
the company is currently exploiting through global sales , the
management is of the opinion that the company would be in a position to
continue as a going concern and hence the accounts have been drawn up
on such basis.
4.1. Details of Security: The term loan from bank is secured by
hypothecation of assets acquired out of that loan. The limits are
further secured by assignment of lease deposit in respect of leased
property at Trivandrum in favour ofthe bank.The loans are also secured
by a corporate guarantee of Accel Limited and pledge of 7,50,000 equity
shares of Accel Transmatic Limited held by Accel Limited, the holding
company.
4.2 Terms of repayment: loans from related party carry an interest of
13.75% p.a. and are repayable in monthly installments of Rs. 500,000,
beginning October 2012 .Term loan from bank carries interest @ 17.50%
p.a and the amount outstanding as on the date of balance sheet is
repayable in quarterly installment of Rs 72,00,000 lakhs . Hire
purchase loans carry an interest of 9% p.a and the amount outstanding
as on the date of balance sheet is repayable in 4 monthly installments
of Rs. 21,991 each. Public deposit carries interest @11% pa (P.Y
10%),and are repayable after 3 years from the respective dates of
acceptance of deposits.
4.3. During the year the company has sold its technology division to
Accel Frontline Limited (AFL) with effect from 15/08/2011 .As per the
terms ofthe agreement the net assets ofthe division has been
transferred to AFL including the Term Loan & Cash Credit accounts with
State Bank of India pertaining to the division. However the
confirmation received from the bank includes the loans pertaining to
the transferred division amounting to Rs. 2,12,59,363/- pending
transfer of the loan & Cash credit limit allocated to the technology
division of AFL by the bank.The company is pursuing with the bank for
the transfer.
Note:The above disclosures and the break up of liability into long term
and short term are based on valuation report of an independent actuary
and relied upon by the auditors
The Cash Credit limits, Term Loan Limits and Non Funded Limits (The
Limits) are secured by hypothecation of Intellectual property rights
and receivables and hypothecation of assets created out of bank finance
and carries interest @ 17.50% p.a and are repayable on demand.
The Limits are also secured by equitable mortgage of company's
immovable properties at Trivandrum & Chennai
The limits are further secured by assignment of lease deposit in favour
of the bank in respect of leased property at Trivandrum. The loans are
also secured by a corporate guarantee of Accel Limited and pledge of
7,50,000 equity shares of Accel Transmatic Limited held by Accel
Limited, the holding company. Also refer note 5.3.
5.1 Dues to Micro, Small Enterprises
The company has initiated the process of identifying the suppliers who
qualify under the definition of micro and small enterprises, as defined
under the Micro, Small and Medium Enterprises Development Act 2006.
Since no intimation has been received from the suppliers regarding
their status under the said Act as at 31 st March 2012, disclosures
relating to amounts unpaid as at the year end, if any, have not been
furnished. In the opinion of the management, the impact of interest, if
any, that may be payable in accordance with the provisions of the Act
is not expected to be material.
6.1 Advances received includes Security deposit including interest
accrued received from an associate company for providing a corporate
guarantee to a bank amounting to Rs. 25,268,776 (P.Y Rs. 22,936,562).
6.2 Unclaimed dividend will be transferred to the Investor Protection
and Education Fund if remains unclaimed, in the year 2012-13 & 2013- 14
respectively.
6.3 Revaluation
The company has revalued its land and buildings at Trivandrum during
the year ended 31.03.2004, at the fair values determined by an
independent external valuer.The valuer determined the fair value by
reference to market-based evidence.
The revaluation resulted in an increase in the value of freehold land
and building by Rs. 1,09,39,354 and Rs.17,50,486, respectively. The
revaluation ofthe building results an additional depreciation charge of
Rs.58,466 every year. In accordance with the option given in the
Guidance Note on Accounting for Depreciation in Companies,the company
recoups such additional depreciation out of revaluation reserve.
6.4 Lease Hold Land
Land under Fixed Assets includes Rs.67.60 lacs being the value of land
allotted and possession handed over by KINFRA Film & Video Park
(KINFRA), a Government of Kerala Undertaking to the Company for
construction of building to house its operations for which the
registration formalities are yet to be completed. As per the agreement
with" the party",the said land is on a 90 year lease and has to be
developed within a period of 3 years from the date of allotment i.e. on
or before 05.04.2010,. The said land could not be developed within the
time frame agreed on account ofthe difficult scenario being faced by
the Animation Industry in general and the company in particular.
KINFRA, in the meantime has changed the status ofthe SEZ from Animation
to include IT/ITES also., This has been approved by the Ministry of
Industries & Commerce vide its letter dated 7th February 2012 .The
company has submitted its proposal to KINFRA to change our status to a
co developer.
6.5 Fixed assets, capital work in progress & Inventory of intangible
assets
The animation division of the company is engaged in the development of
Animation contents, which can be under a service / co production
contract or for creating its own IPR. The cumulative expenses incurred
under co production and IPR creation activities are carried forward
under capital work-in-progress, till the assets are ready for
commercial exploitation. The expenses incurred under service contracts
are carried forward as work in progress inventories till the milestone
billing are achieved. The following amounts are carried forward in the
Accounts as at the year end.:- 1 .Under Fixed Assets & Capital work in
progress (net of amortization) Rs.130,414,971 ( Previous year
Rs.13,160,051 )
6.6 Impairment of Assets
In the opinion ofthe management there is no impairment as on the date
of the balance sheet in the value of the carrying cost of fixed assets
of the company within the meaning of Accounting Standard - 28 on
Impairment of Assets issued under Companies (Accounting Standards)
Rules 2006. Considering the revenue earning potential of the company
and based on estimates, of the cash generation unit of the company.
The Company has sought for confirmation of balances from concerned
parties in respect of major accounts of sundry debtors, other
receivables, loans and advances and sundry creditors outstanding as at
the year-end, which, however is received in some of the cases.
1) In the opinion of the Directors, the current assets, loans and
advances have the value in which they are stated in the balance sheet,
if realized in the ordinary course of business.
2) Unbilled revenue represents amount recognized based on services
performed in advance of billing in accordance with contractual terms.
Note 7: Exceptional items
The Company sold its Technology division ('transferred division') along
with its subsidiary in United States of America to Accel Frontline
Limited, pursuant to a Business transfer agreement w.e.f. August 15th,
2011 on a slump sale basis for a cash consideration of Rs.19.97
crores.The transaction was approved by the Board of Directors on its
meeting held on August 2nd, 2011. As per the terms of the above said
BTA, the company is eligible for an additional amount upto Rs.2 Crores
as incentive if the said division achieves an EBITDA of Rs. 5 crores
for the twelve months period ended 31st March 2012 as finalized by the
audited accounts of the said division. Since the audit of the accounts
and approval /adoption of the same by the Board of Directors of Accel
Frontline Limited has not been completed as on date of finalization of
this company's accounts, the company has not recognized any amounts
towards the incentive for the year ended 31st March 2012.
During the previous year , the company divested 100000 equity shares of
Rs. 10 each representing 10% of Share Capital of Accel IT Resources
Limited (Formerly Accel Academy Limited) for a consideration of Rs. 120
Lakhs.The profit on sale of investments of Rs.60 Lacs was credited to
Profit $nd Loss account as exceptional item.
Capitalization of expenditure
During theyear.thecompany has capitalized thefollowing expenses to the
cost of fixed asset classified under intangible assets/ capital
work-in-progress (CWIP) being the expenses relatable to such assets.
Consequently, expenses disclosed under the respective notes are net of
amounts capitalized by the company.
Taxation:
Provision for current tax is made on the basis of the assessable Income
and /or Mat Provisions, at the tax rate applicable to the relevant
assessment year. No tax provision is made under normal as well under
MAT for the income arising out of the discontinued business considering
the brought forward losses of the company as a whole. The deferred tax
asset and deferred tax liability is calculated by applying tax rate and
tax laws that have been enacted or substantively enacted by the Balance
Sheet date The net Deferred Tax Asset at the yearend amounts to Rs
84,54,064/- (Previous Year Asset Rs.1, 14,83,124) and is not recognized
as a matter of prudence.
Related Party Disclosures Controlling Company - Accel Limited
Subsidiaries & Associates under common control:
Accel Frontline Limited
Accel Frontline Services Limited
Accel IT Resources Limited
Accel Media Ventures Limited
Accel North America Inc - Subsidiary Upto 15.08.2011
Accel Systems Group Inc.
Key Management Personnel:
N R Panicker Non Executive Chairman
Philip John Whole time Director
@ The corporate guarantee was given to a bank for the limits enjoyed by
an associate company, Accel IT Resources Limited while it was a
subsidiary .This is backed by an interest bearing cash deposit of Rs.
230 Lakhs from the said company which is more than the exposure of that
company with the bank as on the date ofthe balance sheet..
Estimated amount of Contracts remaining to be executed on Capital
account and not provided for (Net of Advances) is Rs. Nil Lacs (Previ-
ous year Rs.144.68 Lacs)
It is not practicable for the company to estimate the timings of cash
outflows, if any, in respect of the above pending resolutions of the
respective proceedings.The company does not expect any reimbursement
from third parties in respect ofthe above contingent liability.
Previous year's figures have been regrouped, recasted and rearranged
wherever necessary, to suit the current period layout.
Mar 31, 2010
1. Inter Segment Transfer Pricing
Segment Revenue resulting from transactions with other business
segments is accounted on the basis of transfer price agreed between the
segments. Such transfer prices are either determined to yield a desired
margin or agreed on a negoti- ated basis.
(2) Accounting for provisions, contingent liabilities & contingent
assets
A provision is recognized where the enterprise has a present obligation
as a result of past event and is probable that an outfow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on management estimate required
to settle the obli- gation at the Balance Sheet date. These are
reviewed at each Balance Sheet date and adjusted to refect the correct
Man- agement estimates.
Contingent Liabilities are disclosed by way of notes to the Balance
Sheet. Provision is made in the accounts in respect of those
liabilities which are likely to materialize after the year- end, till
the fnalization of accounts and have material effect on the position
stated in the Balance sheet.
Contingent Assets are not recognized in the fnancial state- ments as a
matter of prudence.
3.1 Impairment of assets
In the opinion of the Management based on estimates of the value in use
of the various cash generating units of the company, there is no
impairment in the value of the carrying cost of fxed assets of the
company within the meaning of Ac- counting Standard à 28 on Impairment
of Assets issued under Companies (Accounting Standards) Rules 2006.
3.2 Current assets, loans and advances
(a) The Company has sought for confrmation of balances from concerned
parties in respect of major accounts of sundry debtors, loans and
advances and sundry creditors outstand- ing as at the year-end, which,
however is received in some of the cases.
(b) During the year, the company entered into an agreement with Kahani
world Inc. Canada to acquire the IPR à Raju, the rick- shawà under a 15
year license for further development and ex- ploitation as 78 X 7
minute episodes for worldwide TV broad- cast. The company felt there is
a potential to develop this into a large product and the Canadian
company was not having immediate plans to develop this further. The
Digital content was earlier being developed as 7 X 7 minutes episodes
for DVD under a co production agreement with them and the company. The
company had raised an invoice on them for Rs.142 lacs. Consequent to
the acquisition of this IPR, the com- pany has carried forward this
amount due from Kahani World including further development cost
incurred as Capital Work in Progress. The amount so far incurred by
Kahani world inc in developing this property is to be treated as their
share of pro- duction cost to be recouped by them at an agreed percent-
age of the revenue over the period of 15 years on commercial
exploitation of this Digital Asset.
(c) In the opinion of the Directors, the current assets, loans and
advances have the value in which they are stated in the bal- ance
sheet, if realized in the ordinary course of business.
(d) Bank balances include Rs. 45.55 Lacs In Current account & De- posit
accounts in respect of Systems & Services Division (SSD) business
transferred w.e.f 1st April 2009 as stated in note no. 21.8 below,
which is yet to be transferred in the transfereeÃs name by the Bank as
at the year end.
3.3 Taxation
(A) Current taxes
Provision for current taxes have been made on the basis of completed
assessments and in other cases on the basis of re- turn fled /
management computation.
3.4 Investments
Provision has been made for the diminution in the value of long-term
investments to the extent considered doubtful by the management. In the
opinion of the management the diminution in net worth of the subsidiary
in United States of America is considered to be temporary in nature on
account of the future business potential of the company and hence no
provision is considered necessary at this stage.
3.5 Preferential warrants
The company had, during the year ended 31.03.2008, issued 25,50,000
convertible warrants of Rs. 10/- each at a premium of Rs 23 aggregating
to Rs.8, 41,50,000/-. on payment of 10% of the aggregate amount
payable. As per the terms of the is- sue, each of these warrants are to
be converted into one Eq- uity share of Rs. 10/- each at a premium of
Rs.23/ each within a period of 18 months from the date of issue of
warrants at the option of the subscribers. In case any subscriber did
not exer- cise the option for such conversion within the prescribed pe-
riod, the amount paid for was to be forfeited. As no subscriber
exercised the option within the prescribed period, the amount received
as advance of Rs. 84,15,000 has been forfeited during the year and
carried to Capital Reserve under Reserves and Surplus.
3.6 Secured loans
A. The Federal Bank Limited:
The unexpired Bank Guarantees issued by the bank and out- standing at
the year end amounting to Rs.12.42 lacs is secured by counter guarantee
by the company and also by way of a corporate guarantee of Accel
Limited.
B. The State Bank of India:
a) The Cash Credit limits, Term Loan Limits and Non Funded Limits ( The
Limits ) are secured by hypothecation of Raw Materials, Semi fnished
goods , fnished goods, Intellectual property rights and receivables and
hypothecation of assets created out of bank fnance.
b) The Limits are also secured by equitable mortgage of com- panyÃs
immovable properties at Trivandrum & Chennai
c) The limits are further secured by assignment of lease de- posits
with Chennai & Trivandrum Landlords. The loans are also secured by
Corporate Guarantee of Accel Limited and pledge of 750000 shares of
Accel Transmatic Limited held by Accel Limited.
d) Secured loans include Rs. 502.92 lacs being Cash credit availed from
State Bank of India for Systems & Services Divi- sion of the company
which was hived off and sold during the year as stated in note no.
21.8. The transaction in the bank ac- count for the year refects the
transactions of erstwhile Sys- tems & Services Division. The Cash
Credit account has since been closed.
C. Hire purchase loans
Hire Purchase loans are secured by hypothecation of the fxed assets
acquired out of such loans.
3.7 (a) Contingencies and commitments
(Rupees in Lacs)
March 31, 2010 March 31, 2009
Outstanding bank guarantees / letter 148.15 129.19
of Credits - $
Corporate Guarantee to a bank on 350.00 200.00
behalf of an Associate Concern @
Claims Against the company not Nil 4.20
acknowledged as debts.
Sales tax Demands Nil Nil
Others 21.67 13.76
$ Includes Rs.147.05 being Guarantees / Letter of Credits issued by
banks on behalf of Systems and Services division (sold as of
01.04.2009) which is yet to be transferred in their name.
@ Also, Counter guaranteed by M/s Accel Limited.
(b) Estimated amount of Contracts remaining to be executed on Capital
account and not provided for (Net of Advances) is Rs. 24.66 Lacs
(Previous year Rs.Nil)
3.8 Exceptional Items
(a) During the year the company, pursuant to the approval of the
members by way of a special resolution by postal ballot, transferred
its Systems & Services Division carrying a Net As- set Book Value of
Rs.788.30 Lacs as on April 1st 2009, to Accel Frontline Services Ltd
with effect from 01.04.2009, on a slump sale basis for a total
consideration of Rs 927.29 Lakhs. The prof- it on sale of the Systems &
Services division representing the sale consideration over and above
the net asset value adjust- ed in the books of accounts as on 01st
April 2009 amounting to Rs. 138.99 lacs (net of tax Rs.138.99 lacs) is
credited to proft and loss account as Ãproft on transfer of BusinessÃ.
The details of the assets and liabilities transferred are as follows:
(b) During the year the company divested 390000 equity shares of Rs. 10
each representing 39% of investment in Accel IT Resources Limited
(Formerly Accel Academy Limited) for a consideration of Rs. 468 Lakhs,
as per the decision taken by the board of directors in its meeting held
on 31.10.2009. Con- sequent to this sale, Accel IT Resources Limited
ceased to be a associate of this company with effect from 01.10.2009.
The proft on sale of investments of Rs.234 Lacs (Previous year Nil) has
been credited to Proft and Loss account.
(c) The company during the year sold 60 Equity Shares held in its
subsidiary Accel Solutions Inc, Japan for a consideration of Rs.3.64
Lacs. The resultant loss on such disinvestment amount- ing to Rs.7.94
Lacs is recognized in the Proft & Loss account.
3.9 (a) Payment to Directors
Details of managerial remuneration u/s 198 ( Minimum remuneration
within the limits of schedule XIII to the Companies Act payable to
whole time Directors.)
3.10 Dues to micro, small & medium enterprises
The company has initiated the process of identifying the sup- pliers
who qualify under the defnition of micro and small en- terprises, as
defned under the Micro, Small and Medium En- terprises Development Act
2006. Since no intimation has been received from the suppliers
regarding their status under the said Act as at 31st March 2010,
disclosures relating to amounts unpaid as at the year end, if any, have
not been furnished. In the opinion of the management, the impact of
interest, if any, that may be payable in accordance with the provisions
of the Act is not expected to be material.
3.10 Segmental reporting
Geographical Segment: The management has identifed the following
geographical segments as its secondary reporting segments.
D) Related parties with whom transactions have taken place during the
year:
Subsidiaries & Associates:
1. Accel North America Inc - Subsidiary
2. Accel IT Resources Limited - $
3. Accel Limited - $
4. Accel Systems Group Inc. - $
5. Accel Frontline Services Limited - $
6. Accel Frontline Limited à Group Company $ Entities under common
control.
E) Key Management Personnel:
N R Panicker Chairman
Philip John Whole time Director
3.11 Employee Benefts
a) Consequent to Accounting Standards 15 of Companies (Accounting
Standards) Rules, 2006 becoming effective, the company has adopted the
said standard with effect from 1st April 2007. In the absence of
balance in Reserves and Surplus as on that date, the difference in
opening liability computed in accordance with the revised standard
amounting to Rs.21.15 lacs is being expensed on a straight line basis
over a period of fve years from that date. The balance amount remaining
unrecognized as on 31st March 2009 is Rs.8.46 lacs. The Amount
recognized in the accounts of the current year is Rs.4.23 lacs.
b) Disclosure required under AS15 Ã "Employee Benefts" (Revised 2005)
1. Defned Contribution Plan
During the year, the company has recognized in the Proft and Loss
Account, an amount of Rs.29.42 lacs (Previous Year Rs.48.28 lacs) on
account of defned contribution towards Provident Fund and Rs.3.88 lacs
(Previous Year 8.84 lacs) towards Employees State Insurance Scheme.
* The assumption of future salary increases takes into account of
infation, seniority, promotions and other relevant factors such as
supply and demand in the employment market.
Note: The above disclosures are based on valuation report of an
independent actuary and relied upon by the auditors.
* The assumption of future salary increases takes into account of
infation, seniority, promotions and other relevant factors such as
supply and demand in the employment market.
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