Mar 31, 2018
1. CORPORATE INFORMATION
ADC India Communications Limited (âthe Companyâ) is a public company domiciled in India. The Company is engaged in providing versatile, reliable and cost effective connectivity solutions to suit individual enterprise and telecom service provider requirements. The Company provides copper and fiber physical connectivity in telecommunications and data networking solutions including structured cabling.
2 BASIS FOR PREPARATION AND PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Statement of Compliance
The financial statements have been prepared in accordance with Ind ASs notified under the Companies (Indian Accounting Standards) Rules, 2015. Upto the year ended March 31, 2017, the Company prepared its financial statements in accordance with the requirements of previous GAAP, which includes Standards notified under the Companies (Accounting Standards) Rules, 2006. These are the first Ind AS financial statements of the Company. The date of transition to Ind AS is April 1, 2016. Refer Note below on first-time adoption of Ind AS for exemptions availed by the Company.
Basis of preparation and presentation
The financial statements have been prepared on the historical cost basis except for certain financial instruments that are measured at fair values at the end of each reporting period, as explained in the accounting policies below.
Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these financial statements is determined on such a basis, except for leasing transactions that are within the scope of Ind AS 17, and measurements that have some similarities to fair value but are not fair value, such as in value in use in Ind AS 36.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2, or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
3 Use of estimates and judgements
In the application of the Companyâs accounting policies, which are described in note 2, the directors of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Litigations:
The Company is a party to certain direct tax and indirect tax disputes. Uncertain tax items for which a provision is made relate principally to the interpretation of tax legislation applicable to arrangements entered into by the Company. Due to the uncertainty associated with such tax items, it is possible that, on conclusion of open tax matters at a future date, the final outcome may differ significantly.
Impairment of Trade receivables
The recognition of impairment loss allowance on trade receivables are based on assumptions about risk of default and expected loss rates. The Company uses judgements in making these assumptions and selecting the inputs to the impairment calculation, based on the Companyâs past history, existing market conditions as well as forward looking estimates at the end of each reporting period.
Provision for Inventory
Obsolete, slow moving and defective inventories are identified from time to time and, where necessary, a provision is made for such inventories. The factors that the Company considers in determining the allowance for obsolete, slow moving and defective inventory include ageing of inventory, estimated shelf life and estimated usage, to the extent each of these factors impact the Companyâs business and markets. The Company considers all these factors and adjusts the inventory provision to reflect its actual experience on a periodic basis.
4.1 Fair value of investment property
(a) As at March 31, 2018, the fair value of the land was estimated as ranging from Rs. 4,354 lakhs to Rs. 4,528 lakhs (As at March 31, 2017 ranging from Rs. 3,918 lakhs to Rs. 4,440 lakhs and As at April 1, 2016 ranging from Rs. 3,744 lakhs to Rs. 4,353 lakhs)
(b) As at March 31, 2018, the fair value of the building was estimated as ranging from Rs. 490 lakhs to Rs. 522 lakhs (As at March 31, 2017 ranging from Rs. 490 lakhs to Rs. 529 lakhs and As at April 1, 2016 ranging from Rs. 490 lakhs to Rs. 536 lakhs)
(c) These fair value estimates are based on independent valuations.
(b) Terms/ rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. Interim dividend is declared by Board of Directors. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders..
(c) Shares held by holding/ ultimate holding company and/ or their subsidiaries/ associates
Out of equity shares issued by the Company, shares held by its holding company, ultimate holding company and their subsidiaries / associates are as below:
On July 31, 2017, a dividend of Rs.3/- per share (total dividend Rs. 138.00 lakhs) was paid to holders of fully paid equity shares. On July 15, 2016, the dividend paid was Rs.2.50/- per share (total dividend Rs. 115.00 lakhs).
In respect of the year ended March 31, 2018, the directors propose that a final dividend of Rs. 4/- per share be paid on fully paid equity shares. This final equity dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. The proposed equity dividend is payable to all holders of fully paid equity shares. The total estimated equity dividend to be paid is Rs. 221.82 lakhs (including dividend tax).
5. Segment Information
(i) Products and services from which reportable segments derive their revenues
Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (CODM) in deciding how to allocate resources and assessing performance. The Companyâs CODM is Managing Director.
Information reported to the CODM for the purposes of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided in respect of the âTelecommunicationâ and âIT - Networkingâ.
Specifically, the Companyâs reportable segments under Ind AS 108 are as follows:
Telecommunication: Manufacturing and trading of Telecom products
IT - Networking: Manufacturing and trading of IT-Networking products.
Aggregation criteria is not applied for any segment reported to the CODM.
(v) Geographical information
The geographical segments individually contributing 10 percent or more of the Companyâs revenues and segment assets are shown separately in the table below. Segment revenues has been disclosed based on geographical location of the customers. Segment assets has been disclosed based on the geographical location of the respective assets.
6. Leasing Arrangements
The Company has entered into non-cancellable operating leases for office premises that are renewable on a periodic basis. The rent expense and the future minimum lease payments under non-cancellable operat ing leases are as follows:
7. Employee benefit plans Defined contribution plans
The Company makes Provident fund and Superannuation fund which are defined contribution plans, for qualifying employees. Under the said schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognises the amount paid / payable to such funds in the Statement of Profit and Loss. The contributions made by the Company towards these schemes are as follows:
Defined benefit plans
The Company offers gratuity, a defined employee benefit scheme to its employees. Following are the risks associated with the plan:
A. Actuarial Risk:
It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons:
Adverse Salary Growth Experience: Salary hikes that are higher than the assumed salary escalation will result into an increase in Obligation at a rate that is higher than expected.
Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption then the Gratuity benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit , the acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate.
Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption then the Gratuity benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.
B. Investment Risk:
For funded plans that rely on insurers for managing the assets , the value of assets certified by the insurer may not be the fair value of instruments backing the liability . In such cases , the present value of the assets is independent of the future discount rate . This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.
C. Liquidity Risk:
Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the company there can be strain on the cash flows.
D. Market Risk:
Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate/government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.
E. Legislative Risk:
Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.
No other post-retirement benefits are provided to these employees.
The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.
Sensitivity Analysis
Gratuity is a lump sum plan and the cost of providing these benefits is typically less sensitive to small changes in demographic assumptions. The key actuarial assumptions to which the benefit obligation results are particularly sensitive to are discount rate and future salary escalation rate. The following table summarizes the impact in percentage terms on the reported defined benefit obligation at the end of the reporting period arising on account of an increase or decrease in the reported assumption by 50 basis points.
These sensitivities have been calculated to show the movement in defined benefit obligation in isolation and assuming there are no other changes in market conditions at the accounting date. There have been no changes from the previous periods in the methods and assumptions used in preparing the sensitivity analysis.
8. Financial Instruments Capital management
The Company manages its capital to ensure that it will be able to continue as going concern while maximising the return to stakeholders. The capital structure of the company consists of equity only. The management of the company reviews the capital structure of the company on a semi-annual basis. The company is not subject to any externally imposed capital requirements.
Financial risk management objectives
The Companyâs risk management is carried out by Treasury department under policies laid down by the management. The Companyâs activities expose it to market risk (which includes currency risk only), credit risk and liquidity risk. Treasury department monitors the risk exposures on a periodical basis and reports to the Board of directors on the risks that it monitors and policies implemented to mitigate risk exposures.
Foreign currency risk management
The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise.
The carrying amounts of the Companyâs foreign currency denominated monetary liabilities (Trade payables) and Assets (Trade receivables) at the end of the reporting period are as follows.
Foreign currency sensitivity analysis
The Company is exposed to the currencies USD and Euro on account of outstanding trade receivables and trade payables.
The following table details the Companyâs sensitivity to a 5% increase and decrease in INR against the USD and Euro . 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A negative number below indicates a decrease in profit or equity where the INR weakens 5% against the relevant currency. For a 5% strengthening of the INR against the relevant currency, there would be a comparable impact on the profit or equity, and the balances below would be positive.
Interest rate risk
The company has not availed any loan from bank or any other parties. Hence company is not exposed to interest rate risk.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of only dealing with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults. Credit exposure is controlled by counterparty limits. Ongoing credit evaluation is performed on the financial condition of accounts receivable. The Company monitors its trade receivables on case to case basis based on the ageing of the days the receivables are due. The concentration of credit risk is with two major customers constituting 60% of trade receivables. This credit risk did not exceed 23% of gross monetary assets at any time during the year. The company does not hold any collaterals to cover its risk associated with trade receivables.
Credit risk also arises from cash and cash equivalents, financial instruments and deposits with banks and financial institutions. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies.
Liquidity risk
Liquidity risk is the risk that the company could be unable to meet its short term financial demands. Liquidity analysis for non derivative financial liabilities-
The following table details the Companyâs remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The table have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company is required to pay.
The management considers that the carrying amount of financial assets and financial liabilities recognised in these financial statements approximate their fair values.
9. Related Party Disclosures
Names of related parties and related party relationship
i) Key managerial personnel (KMP)
Mr. J N Mylaraiah, Managing Director Mr. S Devarajan Ms. Revathy Ashok
Mr. N Srinivasan (Up to March 04, 2018)
Mr. Ravi Bosco Rebello (From August 04, 2017)
ii) Related parties where control exists
Holding Company CommScope Connectivity LLC
Ultimate Holding Company CommScope Holding Company, Inc.
10. Corporate Social Responsibility
As per section 135 of the Companies Act, 2013, a Company meeting the applicability threshold, need to spend at least 2% of average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environments sustainability, disaster relief and rural development projects. A CSR committee has been formed by the Company as per Act. The funds were primarily allocated to a corpus and utilized through the year on these activities which as specified in Schedule VII of the Companies Act, 2013
a. Gross amount required to be spent by the Company during the year Rs 13.09 Lakhs
b. Amount spent during the year on:
11. Ind AS First time adoption reconciliations
In terms of Ind AS 101, âFirst time adoption of Indian Accounting Standardsâ the required reconciliation of equity, other comprehensive income and cash flows with respect to the figures reported under previous GAAP are as given below:
There is no impact on cash flows from operating activities, cash flows from investing activities and cash flow from financing activities on account of Ind AS.
12. Previous period comparatives
Previous year figures have been regrouped or reclassified wherever necessary to conform to current yearâs grouping or classification.
Mar 31, 2017
(b) Terms/ rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. Interim dividend is declared by Board of Directors. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
Note:
The Board of Directors, in its meeting on May 16, 2017, have proposed a final dividend of Rs.3/- per equity share for the financial year ended March 31, 2017. The proposal is subject to the approval of shareholders at the Annual General Meeting to be held on July 28, 2017 and if approved would result in a cash outflow of Rs. 16,609,355 including corporate dividend tax.
1. Related Party Disclosures
Names of related parties and related party relationship Related parties where control exists
Holding Company Comm Scope Connectivity LLC
Ultimate Holding Company Comm Scope Holding Company, Inc.
Related Parties with whom transactions have taken place during the year
Fellow Subsidiaries Comm Scope Technologies Australia Pty Ltd (formerly ADC
Communications (Australia) Pty Ltd.) (CommScope Australia)
CommScope Connectivity Solutions LLC (CommScope USA)
CommScope Technologies LLC
CommScope Connectivity (Wuxi) Co, Ltd. (CommScope Wuxi)
TE Connectivity Global Shared Services India Pvt Ltd. (TEGSS)
TE Connectivity Corporation (TE Corporation)
CommScope Connectivity LLC (CommScope LLC)
(formerly ADC Telecommunications Inc.) (w.e.f.27th August 2015)
TE Connectivity Solutions GmbH, Switzerland (TE Switzerland) (upto 27th August 2015)
Tyco Electronics Technology (Kunshan) Co. Ltd.
(TE Technology) (upto 27th August 2015)
TE Connectivity India Pvt. Ltd. (TE Connectivity)
(upto 27th August 2015)
Tyco EL Malaysia Selang (TE Malaysia)
(upto 27th August 2015)
Tyco Electronics Singapore (TE Singapore)
(upto 27th August 2015)
Key Management Personnel Mr. Mylaraiah J.N, Managing Director
(on deputation from TE Connectivity Global Shared Services India Pvt. Ltd.)
The expected rate of return on plan assets is determined after considering several applicable factors such as the composition of the plan assets, investment strategy, market scenario, etc. In order to protect the capital and optimize returns within acceptable risk parameters, the plan assets are well diversified.
The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.
The estimates 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. Mortality rates are published under the Indian Assured Lives Mortality (2006-08) Ult table.
2. Previous period comparatives
Previous year figures have been regrouped or reclassified wherever necessary to conform to current yearâs grouping or classification.
Mar 31, 2016
(b) Terms/ rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. Interim dividend is declared by Board of Directors. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
1. Employee benefit plans
Defined Contribution Plans
The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs.823,533 (Year ended 31 March, 2015 Rs. 756,515) for Provident Fund contributions, Rs.415,496 (Period ended 31 March, 2015 Rs. 177,864) for Superannuation Fund contributions and Rs. Nil (Period ended 31, March, 2015 Rs. 57,220) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.
Defined benefit plans
Gratuity benefit plan
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance Company in the form of a qualifying insurance policy. The following tables summarizes the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet.
2. Previous period comparatives
Previous year figures have been regrouped or reclassified wherever necessary to conform to current yearâs grouping or classification.
Mar 31, 2015
2.1. CORPORATE INFORMATION
ADC India Communications Limited ("the Company") is a public company
domiciled in India. The Company is engaged in providing versatile,
reliable and cost effective connectivity solutions to suit individual
enterprise and telecom service provider requirements. The Company
provides copper and fiber physical connectivity in telecommunications
and data networking solutions including structured cabling.
2.2 Basis of accounting and preparation of financial statements
The financial statements of the Company have been prepared in
accordance with the Generally Accepted Accounting Principles in India
(Indian GAAP) to comply with the Accounting Standards specified under
Section 133 of the Companies Act, 2013, read with Rule 7 of the
Companies (Accounts) Rules, 2014 and the relevant provisions of the
Companies Act, 2013 ("the 2013 Act") / Companies Act, 1956 ("the 1956
Act"), as applicable. The financial statements have been prepared on
accrual basis under the historical cost convention. The accounting
policies adopted in the preparation of the financial statements are
consistent with those followed in the previous year except for change
in the accounting policy for depreciation as more fully described in
Note 37.
2.3 Use of estimates
The preparation of the financial statements in conformity with Indian
GAAP requires the Management to make estimates and assumptions
considered in the reported amounts of assets and liabilities (including
contingent liabilities) and the reported income and expenses during the
year. The Management believes that the estimates used in preparation of
the financial statements are prudent and reasonable. Future results
could differ due to these estimates and the differences between the
actual results and the estimates are recognised in the periods in which
the results are known / materialise.
2.4 Inventories
Inventories are valued as follows:
Raw materials, components, Lower of cost and net realizable value.
consumable and packing However, materials and other items held
materials for use in the production of inventories
(including materials are not written down below cost if the
in transit) finished products in which they will be
incorporated are expected to be sold at
or above cost. Cost is determined on a
weighted average basis.
Work-in-progress and Lower of cost and net realizable value.
finished Cost includes direct materials and labour
goods (including materials and a proportion of manufacturing
in transit) overheads based on normal operating
capacity. Cost of finished goods
includes excise duty. Cost is determined
on a weighted average basis.
Traded goods(including Lower of cost and net realizable
materials in transit) value. Cost is determined on a weighted
average basis.
Net realizable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion (as appropriate)
and estimated costs necessary to make the sale.
2.5 Cash and cash equivalents (for purposes of Cash Flow Statement)
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
2.6 Cash flow statement
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
2.7 Depreciation and amortization
Depreciable amount for assets is the cost of an asset, or other amount
substituted for cost, less its estimated residual value. Depreciation
on tangible fixed assets has been provided on the straight-line method
as per the useful life prescribed in Schedule II to the Companies Act,
2013.
Intangible assets acquired separately are measured on initial
recognition at cost. Following initial recognition, intangible assets
are carried at cost less accumulated amortization and accumulated
impairment losses, if any.
Intangible assets are amortized on a straight line basis over the
estimated useful economic life ranging from two to five years. The
amortization period and the amortization method are reviewed at each
financial period / year end. If the expected useful life of the asset
is significantly different from previous estimates, the amortization
period is changed accordingly.
Gains or losses arising from derecognition of an intangible asset are
measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in the statement of
profit and loss when the asset is derecognized.
2.8 Revenue recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
Revenue from sale of goods is recognised when the significant risks and
rewards of ownership of the goods have passed to the buyer, which
normally coincides with the delivery of goods in terms of the
arrangements with the customer. Sales include Excise duty but exclude
Sales tax and Value added tax.
Revenue from Turnkey contracts, which are generally time bound fixed
price contracts, are recognised over the life of the contract using
Proportionate Completion method, with contract costs determining the
degree of completion. Foreseeable losses on such contracts are
recognised when probable.
Revenue from service contracts are recognised, when the rendering of
services under a contract is completed or substantially complete.
Interest income is recognized on a time proportion basis taking into
account the amount outstanding and the applicable interest rate. Rental
income is accounted on accrual basis.
2.9 Fixed Assets (Tangible / Intangible)
Fixed assets are stated at cost less accumulated depreciation and
accumulated impairment losses, if any. The cost comprises purchase
price, borrowing costs if capitalization criteria are met and directly
attributable cost of bringing the asset to its working condition for
the intended use. Any trade discounts and rebates are deducted in
arriving at the purchase price.
Subsequent expenditure related to an item of fixed asset is added to
its book value only if it increases the future benefits from the
existing asset beyond its previously assessed standard of performance.
All other expenses on existing fixed assets, including day-to-day
repair and maintenance expenditure and cost of replacing parts, are
charged to the statement of profit and loss for the period during which
such expenses are incurred.
2.10 Foreign currency transactions and translations
1 Initial recognition
Transactions in foreign currencies entered into by the Company are
accounted at the exchange rates prevailing on the date of the
transaction or at rates that closely approximate the rate at the date
of the transaction.
2 Conversion
Foreign currency monetary items are reported using the closing rate.
Non-monetary items are carried at historical cost.
3 Exchange differences
Exchange differences arising on the settlement of monetary items or on
reporting company''s monetary items at rates different from those at
which they were initially recorded during the year, or reported in
previous financial statements, are recognised as income or as expenses
in the year in which they arise.
2.11 Employee Benefits Defined contribution plans
The Company''s contribution to provident fund, superannuation fund and
employee state insurance scheme are considered as defined contribution
plans and are charged as an expense based on the amount of contribution
required to be made and when services are rendered by the employees.
Defined benefit plans
For defined benefit plans in the form of gratuity fund, the cost of
providing benefits is determined using the Projected Unit Credit
method, with actuarial valuations being carried out at each balance
sheet date. Actuarial gains and losses are recognised in the Statement
of Profit and Loss in the period in which they occur. Past service cost
is recognised immediately to the extent that the benefits are already
vested and otherwise is amortised on a straight-line basis over the
average period until the benefits become vested. The retirement benefit
obligation recognised in the Balance Sheet represents the present value
of the defined benefit obligation as adjusted for unrecognised past
service cost, as reduced by the fair value of scheme assets. Any asset
resulting from this calculation is limited to past service cost, plus
the present value of available refunds and reductions in future
contributions to the schemes.
Short-term employee benefits
The undiscounted amount of short-term employee benefits expected to be
paid in exchange for the services rendered by employees are recognised
during the year when the employees render the service. These benefits
include performance incentive and compensated absences which are
expected to occur within twelve months after the end of the period in
which the employee renders the related service.
The cost of short-term compensated absences is accounted as under :
(a) in case of accumulated compensated absences, when employees render
the services that increase their entitlement of future compensated
absences; and
(b) in case of non-accumulating compensated absences, when the absences
occur.
2.12 Segmental Reporting
(i) Identification of segments:
The Company''s operating businesses are organized and managed separately
according to the nature of products and services provided, with each
segment representing a strategic business unit that offers different
products and serves different markets. The analysis of geographical
segments is based on the location in which the customers are situated.
(ii) Allocation of common costs:
Common allocable costs are allocated to each segment according to the
relative contribution of each segment to the total common costs.
(iii) Segment policies:
The Company prepares its segment information in conformity with the
accounting policies adopted for preparing and presenting the financial
statements of the Company as a whole.
2.13 Leases
Where the Company is lessee
Finance leases, which effectively transfer to the Company substantially
all the risks and benefits incidental to ownership of the leased item,
are capitalized at the lower of the fair value and present value of the
minimum lease payments at the inception of the lease term and disclosed
as leased assets. Lease payments are apportioned between the finance
charges and reduction of the lease liability based on the implicit rate
of return. Finance charges are charged directly against income. Lease
management fees, legal charges and other initial direct costs are
capitalised.
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased term, are classified as
operating leases. Operating lease payments are recognized as an expense
in the Statement of profit and loss on a straight-line basis over the
lease term.
Where the Company is lessor
Where the Company as a lessor leases assets under finance leases, such
amounts are recognised as receivables at an amount equal to the net
investment in the lease and the finance income is recognised based on a
constant rate of return on the outstanding net investment. Operating
lease receipts are recognized as other income in the Statement of
profit and loss on a straight-line basis over the lease term.
2.14 Earnings per share
Basic earnings per share are calculated by dividing the net profit or
loss for the period attributable to equity shareholders by the weighted
average number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net
profit or loss for the period attributable to equity shareholders and
the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.
2.15 Taxes on income
Tax expense comprises of current and deferred tax. Current income tax
is measured at the amount expected to be paid to the tax authorities in
accordance with the applicable tax rates and the provisions of the
Income Tax Act, 1961 and other applicable tax laws. The tax rates and
tax laws used to compute the amount are those that are enacted or
substantively enacted, at the reporting date. Current income tax
relating to items recognized directly in equity is recognized in equity
and not in the statement of profit and loss.
Deferred income taxes reflect the impact of timing differences between
taxable income and accounting income originating during the current
year and reversal of timing differences for the earlier years. Deferred
tax is measured using the tax rates and the tax laws enacted or
substantively enacted at the reporting date. Deferred income tax
relating to items recognized directly in equity is recognized in equity
and not in the statement of profit and loss.
Deferred tax liabilities are recognized for all taxable timing
differences. Deferred tax assets are recognized for deductible timing
differences only to the extent that there is reasonable certainty that
sufficient future taxable income will be available against which such
deferred tax assets can be realized. In situations where the Company
has unabsorbed depreciation or carry forward tax losses and items
relating to capital losses, all deferred tax assets are recognized only
if there is virtual certainty supported by convincing evidence that
they can be realized against future taxable profits.
At each reporting date, the Company re-assesses unrecognized deferred
tax assets. It recognizes unrecognized deferred tax asset to the extent
that it has become reasonably certain or virtually certain, as the case
may be, that sufficient future taxable income will be available against
which such deferred tax assets can be realized.
The carrying amount of deferred tax assets are reviewed at each
reporting date. The Company writes-down the carrying amount of deferred
tax asset to the extent that it is no longer reasonably certain or
virtually certain, as the case may be, that sufficient future taxable
income will be available against which deferred tax asset can be
realized. Any such write-down is reversed to the extent that it becomes
reasonably certain or virtually certain, as the case may be, that
sufficient future taxable income will be available.
Deferred tax assets and deferred tax liabilities are offset, if a
legally enforceable right exists to set-off current tax assets against
current tax liabilities and the deferred tax assets and deferred taxes
relate to the same taxable entity and the same taxation authority.
Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which
gives future economic benefits in the form of adjustment to future
income tax liability, is considered as an asset if there is convincing
evidence that the Company will pay normal income tax. Accordingly, MAT
is recognised as an asset in the Balance Sheet when it is probable that
future economic benefit associated with it will flow to the Company.
2.16 Impairment of assets
The carrying values of assets / cash generating units at each balance
sheet date are reviewed for impairment if any indication of impairment
exists.
If the carrying amount of the assets exceed the estimated recoverable
amount, an impairment is recognised for such excess amount. The
impairment loss is recognised as an expense in the Statement of Profit
and Loss, unless the asset is carried at revalued amount, in which case
any impairment loss of the revalued asset is treated as a revaluation
decrease to the extent a revaluation reserve is available for that
asset.
The recoverable amount is the greater of the net selling price and
their value in use. Value in use is arrived at by discounting the
future cash flows to their present value based on an appropriate
discount factor.
When there is indication that an impairment loss recognised for an
asset (other than a revalued asset) in earlier accounting periods no
longer exists or may have decreased, such reversal of impairment loss
is recognised in the Statement of Profit and Loss, to the extent the
amount was previously charged to the Statement of Profit and Loss. In
case of revalued assets such reversal is not recognised.
2.17 Provisions and Contingencies
A provision is recognised when the Company has a present obligation as
a result of past events and it is probable that an outflow of resources
will be required to settle the obligation in respect of which a
reliable estimate can be made. Provisions (excluding retirement
benefits) are not discounted to their present value and are determined
based on the best estimate required to settle the obligation at the
balance sheet date. These are reviewed at each balance sheet date and
adjusted to reflect the current best estimates. Contingent liabilities
are disclosed in the Notes. Contingent assets are not recognised in the
financial statements.
2.18 Operating Cycle
Based on the nature of products / activities of the Company and the
normal time between acquisition of assets and their realization in cash
or cash equivalents, the Company has determined its operating cycle as
12 months for the purpose of classification of its assets and
liabilities as current and non-current.
(b) Terms/ rights attached to equity shares
The Company has only one class of equity shares having a par value of
Rs.10 per share. Each holder of equity shares is entitled to one vote
per share. The Company declares and pays dividend in Indian rupees.
Interim dividend is declared by Board of Directors. The final dividend
proposed by the Board of Directors is subject to the approval of the
shareholders in the ensuing Annual General meeting.In the event of
liquidation of the Company, the holders of equity shares will be
entitled to receive remaining assets of the Company, after distribution
of all preferential amounts. The distribution will be in proportion to
the number of equity shares held by the shareholders.
3. Segment Information
Business Segments : The Company has organized its operations into two
major businesses:
Telecommunication and IT- Networking.
Geographical Segments : The Company''s operations are predominantly
carried out in India and hence geographical segment information is not
separately furnished in this note.
4. Related Party Disclosure
Names of related parties and related party relationship
Related parties where control exists
Holding Company Tyco Electronics AMP GmbH* (TE Germany)
Ultimate Holding Company TE Connectivity Ltd, Switzerland
(TE Switzerland)
Related Parties with whom transactions have taken place during the
year/period
Fellow Subsidiaries ADC Communications (Australia) Pty Ltd.
(ADC Australia)
TE Connectivity Networks Inc. (TE USA)
ADC Telecommunications Inc., USA (ADC
Telecom)
TE Connectivity, Wuxi, China (TE Wuxi)
TE Connectivity, Hongkong Ltd.
(TE HK Ltd)
TE Connectivity India Pvt Ltd.
(TE Connectivity)
TE Connectivity, New Zealand
(TE New Zealand)
Tyco Electronics Technology (Kunshan)
Co. Ltd (TE Technology)
Key Management Personnel Mr. Mylaraiah J.N, Managing Director
(on deputation from TE Connectivity
India Private Limited)
5. Leases
The Company has entered into non-cancellable operating leases for
office premises that are renewable on a periodic basis. Lease rental
expense (net of reimbursements) debited to Statement of profit and loss
for the year is Rs. 6,320,801 (March 31,2014: Rs.4,722,167). The future
minimum lease payments under non-cancellable operating leases are as
follows:
6. Contingent Liabilities (Amount in Rs.)
Particulars March 31, 2015 March 31, 2014
Central sales tax demands - 12,401,527
contested by the Company
Income Tax demands contested 65,372,424 -
by the Company
Customs duty, excise duty &
service tax demand contested
by the Company - 1,216,783
Total 65,372,424 13,618,310
7. Employee benefit plans
Defined Contribution Plans
The Company makes Provident Fund, Superannuation Fund and Employee
State Insurance Scheme contributions which are defined contribution
plans, for qualifying employees. Under the Schemes, the Company is
required to contribute a specified percentage of the payroll costs to
fund the benefits. The Company recognised Rs. 823,213 (Year ended 31
March, 2014 Rs. 696,859) for Provident Fund contributions, Rs. 177,864
(Period ended 31 March, 2014 Rs. 277,369) for Superannuation Fund
contributions and Rs. 57,220 (Period ended 31, March, 2014 Rs. 73,450)
for Employee State Insurance Scheme contributions in the Statement of
Profit and Loss. The contributions payable to these plans by the
Company are at rates specified in the rules of the schemes.
Defined benefit plans Gratuity benefit plan
The Company has a defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on departure at
15 days salary (last drawn salary) for each completed year of service.
The scheme is funded with an insurance Company in the form of a
qualifying insurance policy. The following tables summarises the
components of net benefit expense recognized in the statement of profit
and loss and the funded status and amounts recognised in the balance
sheet.
9. Previous year figures have been regrouped or reclassified wherever
necessary to conform to current yearÂs grouping or classification.
Mar 31, 2014
1. CORPORATE INFORMATION
ADC India Communications Limited ("the Company") is a public company
domiciled in India. The Company is engaged in providing versatile,
reliable and cost effective connectivity solutions to suit individual
enterprise and telecom service provider requirements. The Company
provides copper and fber physical connectivity in telecommunications
and data networking solutions including structured cabling.
2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared in accordance with Generally
Accepted Accounting Principles in India (Indian GAAP) to comply with
the Accounting Standards notifed under Section 211(3C) of the Companies
Act,1956 ( Accounting Standards) Rules, 2006 (as amended) ("the 1956
Act") (which continue to be applicable in respect of Section 133 of the
Companies Act,2013 ("the 2013 Act") in terms of General Circular
15/2013 dated 13 September, 2013 of the Ministry of Corporate Affairs)
and the relevant provisions of 1956 Act/ Companies Act, 2013 as
apllicable. The financial statements have been prepared on accrual basis
under the historical cost convention. The accounting policies adopted
in the preparation of financial statements are consistent with those
followed in the previous year.
3. Segment Information
Business Segments : The Company has organized its operations into two
major businesses: Telecommunication and IT- Networking.
Geographical Segments : The Company''s operations are predominantly
carried out in India and hence geographical segment information is not
separately furnished in this note.
4. Related Party Disclosure
1. Names of related parties and related party relationship Related
parties where control exists
Holding Company Tyco Electronics AMP GmbH* (TE Germany)
Ultimate Holding Company TE Connectivity Ltd, Switzerland
Related Parties with whom transactions have taken place during the
year/period
Fellow Subsidiaries
ADC Communications (Australia) Pty Ltd. (ADC Australia)
TE Connectivity Networks Inc.
(Formerly known as ADC USA Incorporated) (TE USA)
ADC Telecommunications Inc., USA (ADC Telecom)
ADC Telecommunications Sales Inc.
(Formerly known as ADC Digital Communications Inc.)
(ADC Sales, USA)
ADC Telecom Equipment (Shanghai) Company Ltd (ADC Shanghai)
TE Connectivity, Wuxi, China (TE Wuxi)
TE Connectivity, Hongkong Ltd. (TE HK Ltd)
TE Connectivity India Pvt Ltd. (TE Corporation)
TE Connectivity Solutions Gmbh (TE Solutions)
Key Management Personnel
Mr. Mylaraiah J.N, Managing Director
Mr. Sanjay Handu, Managing Director [Upto 5th September, 2013]
*ADC GmbH, the earlier Holding Company merged with Tyco Electronics AMP
GmbH effective 1st May, 2012
5. Leases
Operating Lease:
The Company has non-cancellable operating leases for office premises
that are renewable on a periodic basis. Lease rental expense (net of
reimbursements) debited to Statement of Profit and loss for the year is
Rs. 6,407,445 (March 31, 2013: Rs.1,483,309). The future minimum lease
payments under non- cancellable operating leases are as follows:
6. Contingent Liabilities (Amount in Rs.)
Particulars March 31, 2014 March 31, 2013
Central sales tax demands
contested by the Company 12,401,527 12,401,527
Customs duty, excise duty & service
tax demand contested by the Company 1,216,783 1,216,783
Bank guarantees 42,548,358 39,585,746
Total 56,166,668 53,204,056
7. Employee benefit plans Defined Contribution Plans
The Company makes Provident Fund, Superannuation Fund and Employee
State Insurance Scheme con- tributions which are Defined contribution
plans, for qualifying employees. Under the Schemes, the Compa- ny is
required to contribute a specified percentage of the payroll costs to
fund the benefits. The Company recognised Rs. 638,266 (Year ended 31
March, 2013 Rs. 1,200,950) for Provident Fund contributions, Rs.
277,369 (Period ended 31 March, 2013 Rs. 254,105) for Superannuation
Fund contributions and Rs. 73,450 (Period ended 31, March, 2013 Rs.
72,726) for Employee State Insurance Scheme contribu- tions in the
Statement of Profit and Loss. The contributions payable to these plans
by the Company are at rates specified in the rules of the schemes.
Defined benefit plans Gratuity benefit plan
The Company has a Defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on departure at
15 days salary (last drawn salary) for each completed year of service.
The scheme is funded with an insurance Company in the form of a
qualifying insurance policy.
The following tables summarises the components of net benefit expense
recognized in the statement of Profit and loss and the funded status and
amounts recognised in the balance sheet.
Statement of Profit and loss
Net employee benefit expense (recognised in Employee Cost).
The expected rate of return on plan assets is determined after
considering several applicable factors such as the composition of the
plan assets, investment strategy, market scenario, etc.. In order to
protect the capital and optimise returns within acceptable risk
parameters, the plan assets are well diversifed. The discount rate is
based on the prevailing market yields of Government of India securities
as at the balance sheet date for the estimated term of the obligations.
The estimates 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.
Mortality rates are published under the Indian Assured Lives Mortality
(2006-08) Ult table
8. During the previous year ended March 31, 2013 the Company
restructured its operations by outsourcing manu- facturing to a third
party vendor. Consequent to this, the Company foated a Voluntary
Retirement Scheme (VRS) for its employees during the year ended March
31, 2013 and the cost under the VRS of Rs. 41,303,656 has been treated
as an exceptional item in the Statement of Profit and Loss for that
year.
9. The Company has book Profit u/s 115JB of the Income Tax Act 1961
(the "Act") and the minimum alternate tax (MAT) there on is higher than
the tax liability under the normal provisions of the Act. Thus, the
provision towards tax liabilities has been made based on MAT.
Correspondingly, the Company has also recognised credit for MAT under
section 115JAA of the said Act, which is disclosed as MAT credit
entitlement in the Statement of Profit and Loss.
10. Previous period comparatives:
Previous year fgures have been regrouped or reclassified wherever
necessary to conform to current year''s classification.
Mar 31, 2013
1. CORPORATE INFORMATION
ADC India Communications Limited ("the Company") is a public company
domiciled in India and incorporated under the provisions of the
Companies Act, 1956. The Company is engaged in providing versatile,
reliable and cost effective connectivity solutions to suit individual
enterprise and telecom service provider requirements. The Company
provides copper and fber physical connectivity in telecommunications
and data networking solutions including structured cabling.
2. BASIS OF PREPARATION
The fnancial statements of the Company have been prepared in accordance
with generally accepted accounting principles in India (Indian GAAP).
The Company has prepared these fnancial statements to comply in all
material respects with the accounting standards notifed under the
Companies (Accounting Standards) Rules, 2006, (as amended) and the
relevant provisions of the Companies Act, 1956.
The accounting policies adopted in the preparation of fnancial
statements are consistent with those of previous year.
3. Related Party Disclosure
1. Names of related parties and related party relationship Related
parties where control exists
Holding Company Tyco Electronics AMP GmbH* (TE Germany)
Ultimate Holding Company TE Connectivity Ltd, Switzerland
Related Parties with whom transactions have taken place during the
period
Fellow Subsidiaries ADC Communications Hongkong Ltd (ADC Hongkong)
ADC Communications (Australia) Pty Ltd. (ADC Australia)
TE Connectivity Networks Inc. (Formerly known as ADC USA Incorporated)
(TE USA)
ADC Telecommunications Inc., USA (ADC Telecom)
ADC Telecommunications Sales Inc. (Formerly known as ADC Digital
Communications Inc.) (ADC Sales, USA)
ADC Telecom Equipment (Shanghai) Company Ltd (ADC Shanghai)
TE Connectivity, Shanghai
TE Connectivity, Wuxi, China (TE Wuxi)
LGC Wireless Inc (LGC Wireless)
Shenzehen Century Man Communication (Shenzehen)
TE Logistics GmbH, Germany (TE Logistics Germany)
TE Connectivity India Pvt Ltd. (TE Corporation)
TE Connectivity Solutions Gmbh (TE Solutions)
ADC Communications (SEA) Pte. Ltd. (ADC Singapore)
Key Management Personnel Mr. Sanjay Handu, Managing Director
*ADC GmbH, the earlier Holding Company merged with Tyco Electronics AMP
GmbH effective 1st May, 2012
4. Leases
Operating Lease:
The Company has non-cancellable operating leases for offce premises
that are renewable on a periodic basis. Lease rental expense (net of
reimbursements) debited to Statement of proft and loss for the year is
Rs.1,483,309 (March 31, 2012: Rs.670,171). The future minimum lease
payments under non-cancellable operating leases are as follows:
5. Contingent Liabilities
(Amount in Rs.)
Particulars March 31, 2013 March 31, 2012
Central sales tax
demands contested
by the Company 12,401,527 17,350,167
Customs duty, excise
duty & service tax
demand contested
by the Company 1,216,783 180,269
Bank guarantees 39,585,746 52,499,038
Total 53,204,056 70,029,474
6. Employee beneft plans Defned Contribution Plans
The Company makes Provident Fund, Superannuation Fund and Employee
State Insurance Scheme contributions which are defned contribution
plans, for qualifying employees. Under the Schemes, the Company is
required to contribute a specifed percentage of the payroll costs to
fund the benefts. The Company recognised Rs. 1,200,950 (Year ended 31
March, 2012 Rs. 1,174,381) for Provident Fund contributions, Rs.
254,105 (Period ended 31 March, 2012 Rs.385,646) for Superannuation
Fund contributions and 72,726 (Period ended 31, March, 2012 Rs. 71,951)
for Employee State Insurance Scheme contributions in the Statement of
Proft and Loss. The contributions payable to these plans by the Company
are at rates specifed in the rules of the schemes.
Defned beneft plans Gratuity beneft plan
The Company has a defned beneft gratuity plan. Every employee who has
completed fve years or more of service gets a gratuity on departure at
15 days salary (last drawn salary) for each completed year of service.
The scheme is funded with an insurance Company in the form of a
qualifying insurance policy.
The following tables summarises the components of net beneft expense
recognized in the statement of proft and loss and the funded status and
amounts recognised in the balance sheet.
7. During the year the Company decided to restructure its operations
by outsourcing manufacturing to a third party vendor. Consequent to
this, the Company foated a Voluntary Retirement Scheme (VRS) for its
employees and the cost under the VRS of Rs. 41,303,656 is treated as an
exceptional item in the Statement of Proft and Loss.
8. Previous period comparatives:
Previous period fgures have been regrouped or reclassifed wherever
necessary to conform to current period''s classifcation. The current
year fgures are for the 12 months ended March 31, 2013, whereas
previous period ended March 31, 2012 was for 6 months and hence not
comparable.
Sep 30, 2011
1. Figures in brackets represent amounts for previous year ended
September 30, 2010.
2. Expenses reimbursed (includes management service fees, rent,
freight charges etc.) have been debited / credited to the respective
heads of expenses in the profit and loss account.
3. Remuneration paid to directors is disclosed below under Note 8.
4. Capital Commitments
Estimated amount of contracts remaining to be executed on capital
account and not provided for amounts to Rs. Nil (Previous year - Rs.
227,230).
* The above amount includes Rs.1,058,000 paid as severance pay towards
compensation for loss of office.
Note: Remuneration to Managing Director for the previous year is as per
limits specified in Schedule - XIII of the Companies Act, 1956.
* It is not practicable to furnish quantitative information in view of
the large number of items which differ in size and nature, each being
less than 10% in value of the total.
b) Defined Benefit Scheme
Gratuity benefit plan:
The Company has a defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on departure at
15 days salary (last drawn salary) for each completed year of service.
The scheme is funded with an insurance company in the form of a
qualifying insurance policy.
The following tables summarise the components of net benefit expense
recognised in the profit and loss account and the funded status and
amounts recognised in the balance sheet.
The estimates 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.
5. Unhedged Foreign Exchange Exposure
Particulars of Unhedged Foreign Currency Exposure as at the Balance
Sheet date
6. Previous period comparatives
Previous period figures have been regrouped or reclassified wherever
necessary to conform to current period's classification.
Sep 30, 2010
1. NATURE OF OPERATIONS
ADC India Communications Ltd. (formerly Krone Communications Limited)
("the Company") is engaged in providing versatile, reliable and cost
effective connectivity solutions to suit individual enterprise and
telecom service provider requirements. The Company provides copper and
fibre physical connectivity in telecommunications and data networking
solutions including structured cabling.
The Company is headquartered at Bangalore and has its manufacturing
facility at Peenya and Regional sales offices in New Delhi, Mumbai,
Chennai, Hyderabad and Pune.
2. Segment Information
Business Segments :
The Company has organized its operations into two major businesses:
Telecommunication and IT- Networking.
3. Related Party Disclosure
1. Names of related parties
Holding Company ADC GmbH., Germany
Ultimate Holding Company ADC Telecommunications Inc., USA
Fellow Subsidiaries
ADC Communications Hongkong Ltd.
ADC Communications (Australia) Pty Ltd.
ADC USA Incorporated.
ADC Digital Communications Inc.
ADC Communications (UK) Ltd.
ADC Communications (SEA) Pte Ltd.
ADC (India) Communications & Infotech Pvt Ltd.
ADC Telecom Equipment (Shanghai) Company Ltd.
LGC Wireless Inc.
Shenzehen Century Man Communication.
Key Management Personnel
Mr. K Bala Chandran, Chairman & Managing Director
4. Leases
(a) Finance Lease :
The Company had entered into finance lease arrangements for vehicles.
The period of lease was 4 years and there are no remaining lease
obligation outstanding as at the year-end for such arrangements.
(b) Operating Lease:
The Company has operating leases for office premises that are renewable
on a periodic basis and cancellable at its option. Lease rental expense
debited to Profit and Loss Account for the period is Rs. 4,554,551
(Previous period: Rs. 3,021,234). The future minimum lease payments for
operating lease for the period that the facilities are expected to be
occupied is as follows:
5. Capital Commitments
Estimated amount of contracts remaining to be executed on capital
account and not provided for amounts to Rs. 227,230 (Previous period -
Rs. 887,660).
6. Contingent Liabilities not provided for (Amount in Rs.)
30 Sep. 2010 30 Sep. 2009
Sales tax demands contested by
the Company. 11,223,615 14,385,303
Letters of Credit 267,336 544,647
Bank guarantees 121,181,984 80,405,716
7. Previous period comparatives
Previous period figures have been regrouped or reclassified wherever
necessary to conform to current periods classification. The previous
period figures are for the eleven months period ended September 30,
2009 and hence not comparable with those of the current year ended
September 30, 2010.
Sep 30, 2009
1. NATURE OF OPERATIONS
Krone Communications Ltd. ("the Company") is engaged in providing
versatile, reliable and cost effective connectivity solutions to suit
individual enterprise and telecom service provider requirements. The
Company provides copper and fibre physical connectivity in
telecommunications and data networking solutions including structured
cabling.
The Company is headquartered at Bangalore and has its manufacturing
facility at Peenya and Regional sales offices in New Delhi, Mumbai,
Chennai, Hyderabad and Pune.
2. Segment Information Business Segments:
The Company has organized its operations into two major businesses:
Telecommunication and IT- Networking.
3. Related Party Disclosure
1. Names of related parties
Holding Company ADC GmbH
Ultimate Holding Company ADC Telecommunications Inc.
Fellow Subsidiaries ADC Communications (Australia) Pty Ltd.
ADC Communications Hongkong Ltd.
ADC Communications (NZ) Ltd.
ADC Communications (UK) Ltd
ADC USA Incorporated
ADC Communications (Shanghai) Company Ltd
ADC Digital Communications Inc.
ADC Communications (SEA) Pte Ltd.
Key Management Personnel
Mr. K Bala Chandran, Chairman & Managing Director
4. Previous year comparatives
Previous year figures have been regrouped or reclassified wherever
necessary to conform to current periods classification. The current
period figures are forthe eleven month period ended September 30,2009
and hence not comparable with those of the previous year ended October
31, 2008.