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Notes to Accounts of Bharat Agri Fert & Realty Ltd.
Mar 31, 2024
l. Provisions, Liabilities and Contingencies
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material). When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.
m. Revenue Recognition
The Company derives revenues primarily from Sale of Fertiliser and business of Real Estate Development; its other operating revenues include Lease Rentals.
Revenue from contracts with customers for sale of goods or services is recognised when the Company satisfies performance obligation by transferring promised goods or services to the customer at an amount that reflects the consideration which the Company is expected to be entitled to in exchange for those goods or services.
Revenue is measured based on the transaction price, which is the consideration, adjusted for trade discounts, incentives and returns, if any, as specified in the contract with the customer. Revenue also excludes taxes collected from customers. The trade discounts incentives and right of return are estimated and provided for, based on historical, current and forecast information available. A refund liability is recognised for expected returns in relation to sales made, corresponding assets are recognised for the products expected to be returned.
The Company does not expect to have any contract where the period between the transfer of the promised goods or services to the customer and payment by the customer exceed one year. As a consequence, the Company does not adjust any of the transaction prices for the time value of money.
Sale of Goods
Revenue from sale of goods is recognised at a point in time when the control of the goods is transferred to the customer involving single performance obligation. The control of goods is transferred to the customer depending upon the incoterms or as agreed with customer, delivery basis or dispatch, as the case may be (i.e. at the point in time when goods are delivered at the dealer site or when the customer purchases the goods at the retail outlet).
Sale of Services
Revenue from services, which mainly consists of lease rentals from letting of space, is recognised over time on satisfying performance obligations as per the terms of agreement, that is, by reference to the period in which services are being rendered. Revenue from services, if any, involving single performance obligation is recognised at a point in time. Revenue is recognized upon rendering of the service, provided pervasive evidence of an arrangement exists, tariff / rates are fixed or are determinable and collectability is reasonably certain. Revenue from rendering of services is net of Indirect taxes, returns and discounts.
Government Subsidy
Subsidy is recognised on the basis of the rates notified from time to time by the Government of India in accordance with the Nutrient Based Subsidy (NBS) policy on the quantity of fertilisers sold by the Company for the period for which notification has been issued.
Construction and real estate development
Revenue is recognised on satisfaction of performance obligation upon transfer of control of promised goods (residential) or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.
The Company satisfies the performance obligation and recognises revenue over time, if one of the following criteria is met:
The customer simultaneously receives and consumes the benefits provided by the Company''s performance as the Company performs; or
ii. The Company''s performance creates or enhances an asset that the customer controls as the asset is created or enhanced; or
iii. The Company''s performance does not create an asset with an alternative use to the Company and an entity has an enforceable right to payment for performance completed to date.
For performance obligations where any one of the above conditions are not met, revenue is recognised at the point in time at which the performance obligation is satisfied.
Revenue is recognised either at point of time or over a period of time based on the conditions in the contracts with customers. The Company determines the performance obligations associated with the contract with customers at contract inception and also determine whether they satisfy the performance obligation over time or at a point in time.
The Company recognises revenue for performance obligation satisfied over time only if it can reasonably measure its progress towards complete satisfaction of the performance obligation.
The Company uses cost based input method for measuring progress for performance obligation satisfied over time.
Under this method, the Company recognises revenue in proportion to the actual project cost incurred as against the total estimated project cost.
In respect of contract with customers which do not meet the criteria to recognise revenue over a period of time, revenue is recognized at point in time with respect to such contracts for sale of residential and commercial units as and when the control is passed on to the customers which is linked to the application and receipt of occupancy certificate.
Revenue is recognized net of discounts, rebates, credits, price concessions, incentives, etc. if any.
Trade Receivables, Contract Assets and Contract Liabilities Trade Receivables
A receivable is recognised by the Company when the control over the goods and services is transferred to the customer such as when goods and services are delivered as this represents the point in time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due (which is referred to as "Trade Receivable").
A receivable is recognised when the Company''s right to an amount of consideration under the contract with the customer that is unconditional, as only the passage of time is required before payment is due.
Contract Assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs by transferring goods or services to a customer before the customer pays consideration or before payment is due, a contract asset is recognised for the earned consideration that is conditional.
Contract liabilities
A contract liability is the obligation to transfer goods or services to the customer for which the consideration (or the amount is due) has been received from the customer. If the customer pays the consideration before the transfer of goods or services to the customer, a contract liability is recognised when the payment is made. Contract liabilities are recognised as revenue when the Company performs under the contract.
Interest Income and Dividend
Interest income is recognised on a time proportion basis taking into account the amount outstanding and the applicable interest rates. Interest income is included under the head "Other Income" in the Statement of Profit and Loss.
Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income from a financial asset is recognized using the effective interest rate (EIR), which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition.
Dividend Income is recognised when the right to receive the payment is established. Incomes from investments are accounted on an accrual basis.
n. Lease Liability
The Company as a Lessee
The Company recognises right-of-use asset representing its right to use the underlying asset for the lease term and a corresponding lease liability at the lease commencement date i.e. the date at which the leased asset is available for use by the Company. The cost of the right-of-use asset measured at inception shall comprise of the amount of the initial measurement of the lease liability adjusted for any lease payments made at or before the commencement date less any lease incentives received, plus any initial direct costs incurred and an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset or restoring the underlying asset or site on which it is located. The right-of-use assets is subsequently measured at cost less any accumulated depreciation, accumulated impairment losses, if any and adjusted for any remeasurement of the lease liability. The right-of-use assets is depreciated using the straightline method from the commencement date to the earlier of the end of the useful life of right-of-use asset or the end of the lease term. The estimated useful lives of right-of use assets are determined on the same basis as those of property, plant and equipment. Right-of-use assets are tested for impairment whenever there is any indication that their carrying amounts may not be recoverable. Impairment loss, if any, is recognised in the statement of profit and loss.
The Company measures the lease liability at the present value of the lease payments that are not paid at the commencement date of the lease. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses incremental borrowing rate. For leases with reasonably similar characteristics, the Company, on a lease by lease basis, may adopt either the incremental borrowing rate specific to the lease or the incremental borrowing rate for the portfolio as a whole. The lease payments shall include fixed payments, variable lease payments, residual value guarantees, exercise price of a purchase option where the Company is reasonably certain to exercise that option and payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an option to terminate the lease. The lease liability is subsequently remeasured by increasing the carrying amount to reflect interest on the lease liability, reducing the carrying amount to reflect the lease payments made and remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised in-substance fixed lease payments. Where the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognises any remaining amount of the re-measurement in statement of profit and loss.
The Company has elected not to apply the requirements of Ind AS 116 Leases to short-term leases of all assets that, at the commencement date, have a lease term of 12 months or less and leases for which the underlying asset is of low value. The lease payments associated with these leases are recognized as an expense on a straight-line basis over the lease term.
The Company as a Lessor:
The Company recognises lease payments received under operating leases as income on a straight-line basis over the lease term as part of ''Other Operating Income under Revenue from Operation'' in the Statement of Profit and Loss.
o. Cost Recognition
Costs and expenses are recognised when incurred and are classified according to their nature.
p. Employee Benefits
Long Term Post-employment benefits
Provident and Family Pension Fund
The eligible employees of the Company are entitled to receive post-employment benefits in respect of provident and family pension fund, in which both the employees and the Company make monthly contributions at a specified percentage of the employees'' eligible salary (currently 12% of employees'' eligible salary). The contributions are made to the provident fund and pension fund to respective Regional Provident Fund Commissioner. The Company has no further obligations beyond making the contribution.
The company has the following Defined Benefit Plans:
Gratuity
The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees.
Other long term employee benefits - The Company provides for encashment of leave or leave with pay subject to certain rules.
The Company makes provision for such compensated absences based on an actuarial valuation by an independent actuary at the year end, which is calculated using Project Unit Credit Method (PUCM). Actuarial gains and losses which comprise experience adjustment and the effect of change in actuarial assumptions are recognised in the Statement of Profit and Loss.
Short Term Employee Benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries, performance incentives and similar benefits other than compensated absences in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.
Contributions to defined contribution schemes are recognised as an expense when employees have rendered service entitling them to the contributions.
q. Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in Statement of Profit and Loss in the period in which they are incurred.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing costs also include exchange differences to the extent regarded as an adjustment to the borrowing costs.
r. Government Grants
Government grants are not recognised until there is reasonable assurance that the Company will comply with the conditions attaching to them and that the grants will be received.
Government grants are recognised in Statement of Profit and Loss on a systematic basis over the periods in which the Company recognizes as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Company should purchase, construct or otherwise acquire non-current assets are recognised as deferred revenue in the Balance Sheet and transferred to Statement of Profit and Loss on a systematic and rational basis over the useful lives of the related assets.
Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Company with no future related costs are recognised in Statement of Profit and Loss in the period in which they become receivable.
The benefit of a government loan at a below-market rate of interest is treated as a government grant, measured as the difference between proceeds received and the fair value of the loan based on prevailing market interest rates.
s. Foreign Currency Transactions
The management of the Company has determined Indian Rupee ("INR") as the functional currency of the Company. In preparing the Financial Statements of the Company, transactions in currencies other than the Company''s functional currency ("foreign currencies") are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
t. Earnings Per Share
Basic earnings per share are calculated by dividing the net profit or loss for the period attributable to the equity shareholders by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period and for all periods presented is adjusted for events, such as bonus issue, bonus element in a rights issue and shares split that have changed the number of equity shares outstanding, without a corresponding change in resources. For the purpose of calculating Diluted Earnings per share, the net profit or loss for the period attributable to the equity shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.
u. Taxation Current Tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before tax as reported in the Statement of Profit and Loss because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Company''s current tax is calculated using tax rates that have been enacted by the end of the reporting period.
Deferred Tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the Financial Statements and their corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against those deductible temporary differences which can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. In addition, deferred tax liabilities are not recognised if the temporary difference arises from the initial recognition of goodwill.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and deferred tax liabilities are offset if there is a legally enforceable right to offset current tax assets against current tax liabilities and deferred tax assets and liabilities relate to the income tax levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the current tax liabilities and assets on a net or simultaneous basis.
Current and deferred tax for the year
Current and deferred tax are recognised in Statement of Profit and Loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.
v. Segment Reporting
Ind AS 108 establishes standards for the way that public enterprises report information about operating segments and related disclosures about products, services, geographic areas, and major customers. Based on the ''management approach'' as defined in Ind AS 108, the company is required to present information in the manner which the corporate executive management evaluates the company''s performance and allocates resources. The analysis is generally based on an analysis of various performance indicators by business segments.
The accounting principles used in the preparation of the Financial Statements are consistently applied to record revenue and expenditure in individual segments, and are as set out in the relevant applicable accounting policies above. Revenue and identifiable operating expenses in relation to segments are categorized based on items that are individually identifiable to that segment.
Segment assets include all operating assets used by the business segments and consist principally of fixed assets, debtors and inventories. Segment liabilities include the operating liabilities that result from the operating activities of the business. Segment assets and liabilities that cannot be allocated between the segments are shown as part of unallocated corporate assets and liabilities respectively. Income / Expenses relating to the enterprise as whole and not
allocable on a reasonable basis to business segments are reflected as unallocated corporate income / expenses. Intersegment transfers are accounted at prevailing market prices.
3. Significant accounting judgments, estimates and assumptions
i. Fair value measurement of Financial Instruments
When the fair values of financials assets and financial liabilities recorded in the financial statements cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques which involve various judgements and assumptions.
ii. Estimation of net realizable value for inventories
Inventory is stated at the lower of cost and net realizable value (NRV). NRV for completed inventory is assessed by reference to market conditions and prices existing at the reporting date and is determined by the Company, based on comparable transactions identified.
iii. Impairment of non - financial assets
The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset''s recoverable amount. An asset''s recoverable amount is the higher of an asset''s or cash-generating unit''s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used.
iv. Recoverability of trade receivables
In case of trade receivables, the Company follows the simplified approach permitted by Ind AS 109 - Financial Instruments for recognition of impairment loss allowance. The application of simplified approach does not require the Company to track changes in credit risk. The Company calculates the expected credit losses on trade receivables using a provision matrix on the basis of its historical credit loss experience.
v. Defined benefit plans
The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
vi. Recent pronouncements:
There are no standards of accounting or any addendum thereto, prescribed by Ministry of Corporate Affairs under section 133 of the Companies Act, 2013, which are issued and not effective as at March 31, 2024.
Basis of identifying operating segments, reportable segments, segment profit and definition of each reportable segment:
(i) Basis of identifying Operating segments:
Operating segments are identified as those components of the Company
(a) that engage in business activities to earn revenues and incur expenses (including transactions with any of the Company''s other components);
(b) whose operating results are regularly reviewed by the Company''s executive management to make decisions about resource allocation and performance assessment; and
(c) for which discrete financial information is available.
The Company has three reportable segments as described under "segment composition" below. The nature of products and services offered by these businesses are different and are managed separately given the different sets of technology and competency requirements.
(ii) Reportable segments
An operating segment is classified as reportable segment if reported revenue (including inter-segment revenue) or absolute amount of result or assets exceed 10% or more of the combined total of all the operating segments.
(iii) Segment profit
Performance of a segment is measured based on segment profit (before interest and tax), as included in the internal management reports that are reviewed by the corporate executive management.
A. Based on the above,for management purposes, the Company is organized into following three business units based on the risks and rates of returns of the products offered by these unit as per Ind AS 108 on ''Operating Segment'' :
Construction - sale of residential flats Fertilizers- sale of single super phosphate
Resort - Room / unit accomodation and services provided by theme based resort No operating segments have been aggregated to form the above reportable operating segment.
Also, the Company''s financing (including finance costs and finance income) and income taxes are managed on a Company basis (unallocable) and are not allocated to operating segments.
Transfer prices between operating segments are on an arm''s length basis in a manner similar to transactions with third parties.
140. FINANCIAL RISK MANAGEMENT |
The Company''s Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors is responsible for developing and monitoring the Company''s risk management policies.
The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
The finance team oversees how management monitors compliance with the company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.
The Company''s activity exposes it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the company manages the risk.
(A) Credit risk
Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk arises from cash and cash equivalents, financial assets carried at amortised cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.
(a) Trade and Subsidy receivables
Credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the company grants credit terms in the normal course of business.
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
A default on a financial asset is when the counterparty fails to make contractual payments of when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
i. Provision for expected credit losses
The company follows ''simplified approach'' for recognition of loss allowance on Trade and Subsidy receivables.
As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forwardlooking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.
(b) Other Financial Assets
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
A default on a financial asset is when the counterparty fails to make contractual payments when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
The carrying amount of cash and cash equivalents, loans, deposits with banks and financial institutions and other financial assets represents the maximum credit exposure.
(B) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due. The Company consistently generated sufficient cash flows from operations to meet its financial obligations.
Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the company''s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements.
Contractual maturities of financial liabilities (undiscounted values):
The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. In the table below, borrowings include principal cash flows.
(C) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk and other price risk such as commodity price risk.
(i) Foreign exchange rate and interest rate risk
Foreign currency risk is the risk of impact related to fair value or future cash flows of an exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the import payables.
The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies and standard operating procedures to mitigate the risks.
The company do not have any foreign currency borrowings.
(ii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The management is responsible for the monitoring of the Company'' interest rate position. Various variables are considered by the management in strucutring the Company''s borrowings to achieve a reasonable and competitive cost of funding.
However, during the periods presented in the financial statements, the Company has primarily borrowed funds under fixed interest rate arrangements with banks and financial institutions and therefore the Company is not significantly exposed to interest rate risk.
(iii) Inventory price risk
The company is exposed to the movement in price of principal finished product i.e Fertilizer. The main raw material i.e Rock Phosphate is imported from Egypt / Jordan and its price is variable depending upon exchange rate. Fertiliser being a seasonal as well as subsidized product; prices of fertilizer are monitered by government. Department of Fertilizer implemented "Direct Benefit Transfer" (DBT) system for eligibility of subsidy on sale of fertilizer through POS machines. Company monitors the fertilizer prices on daily basis and formulates the sales strategy to achieve maximum realisation.
|41. CAPITAL MANAGEMENT |
For the purpose of the company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximise the shareholder value.
The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The company includes within debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents and other bank balances.
|Sr.No. Reason for variance
1 Current ratio has been improved due to increase in inventory and repayment of short term borrowings.
2 Debt Equity Ratio increased as debt of the company has increased during the year, borrowed funds are for real estate division and expansion of resort division.
3 Debt service coverage ratio has improved due to repayment of short term borrowings.
4,9 & Return on equity, Return on capital emplyed and Net Profit ratio has improved compared to last year. Fertiliser division capacity utilization is less than 10% and 10 performance of resort division has improved as compared to last year.
5, 6 & Inventory Turnover Ratio, Trade Receivables Turnover Ratio and Net capital turnover ratio reduced due to decrease in sales.
8
7 Trade Payables Turnover Ratio increased to due to increase in trade payables.
11 Returns on Mutual funds, dividend and long term capital gain on sale of unquoted investment has improved the Return on investment ratio.
45. In the opinion of the Board, any of the assets other than Property, Plant and Equipment , Intangible assets and non-current investments do not have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated"
49. The Company has performed the assessment to identify transactions with struck-off companies as at 31 March 2024 and identified no company with any transactions.
50. There is no pending registration of charges or satisfaction of charges with Registrar of Companies."
51. Exceptional Items includes one time loss due to drastic reduction in subsidy rates w.e.f 01.10.2023 and said reduction is applicable on unsold inventory of SSP fertiliser as per Ifms portal and POS mechanism under NBS policy."
52. Disclosure pursuant to regulation 34 (3) of Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulation, 2015 and Section 186 of the Companies Act,
2013 is not applicable to the Company as at 31.3.24
53. There have been no events after the reporting date that require disclosure in these financial statements other than proposed dividend.
54. Previous year''s amounts are regrouped and reclassified to make them comparable with current year''s classification, wherever necessary."
As per our report of even date attached 1 to 54
For DESAI SAKSENA & ASSOCIATES For BHARAT AGRI FERT & REALTY LIMITED
Chartered Accountants Firm Registration No : 102358W
Y. D. Patel A. Y. Patel
Chairman and Managing Director Whole Time Director
(DIN : 00106864) (DIN :00106976)
CA (Dr.) Shashank N. Desai
Partner
Membership No. 032546 K. N. Jethwa Akshay Kumar
Director & CFO Company Secretary
(DIN : 00107034) Membership No. ACS 53650
Place : Mumbai Place : Mumbai
Date : May 30, 2024 Date : May 30, 2024
Mar 31, 2023
The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liablities relate to income taxes levied by the same tax authority.
Considering the probability of availability of future taxable profits in the period in which tax losses expire, deferred tax assets have not been recognised in respect of tax credits carried forward by the Company.
Major Components of income tax expense for the years ended March 31, 2023 and March 31, 2022 are as follows:
Terms/rights attached to equity shares
The company has only one class of equity shares having par value of INR 1 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
During the year ended 31st March 2023, the amount of per share final dividend recognised as distributions to equity shareholders was Nil (P.Y final dividend Nil)
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.
iv. The Company had equity shares having face value Rs.10 vide Extra ordinary meeting dated 28/02/2023, the equity shares having face value Rs.10 has subdivided to Re 1 per share.
v. Aggregate number of equity shares issued as bonus, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding the reporting date: NIL (previous period of five years ended March 31, 2022: NIL)
vi. None of the above shares are reserved for issue under options/contract/commitments for sale of shares or disinvestment.
vii. The Company does not have any holding company.
The Company created a General Reserve in earlier years pursuant to the provisions of the Companies Act wherein certain percentage of profits were required to be transferred to General Reserve before declaring dividends. As per Companies Act 2013, the requirement to transfer profits to General Reserve is not mandatory. General Reserve is a free reserve available to the Company.
Current and Non Current Borrowings
Terms and Conditions of Repayment and Details of Securities are as under :
1. The loan from Bank of Baroda is Repayable on demand. Term loan (BGECL 1 ) is having repayment period of 48 months with 12 months of moratoriam period (O/s Rs.161.11 Lacs), Term loan (BGECL 2) is having repayment period of 60 months with 24 months of moratoriam period (O/s Rs.150.00 Lacs). Said loans are availed for Fertiliser Division. 1. Rate of interest 9.25% 2. Repayment in equal installments of Rs.8.05 lacs to Rs.4.17 lacs.
2. Cash Credit loan is secured by hypothecation of stock of raw material, semi-finished goods and stores and spares, packing material, finished goods , receivables (both present and future).
3. Cash Credit loan & term loanis secured by equitable mortgage on factory Land(measuring 18.36 acre) and buildings situated at village Kharivali, Taluka-Wada, District-Palghar.
4. Cash Credit loan is secured by hypothecation of Plant and machinery and all other movable fixed Property, Plant and Equipment of the Company already in possession or to be in possession of the Company.
5. Overdraft facility from Saraswat Bank is secured by equitable mortgage on land measuring 2 acre and building (studio) situated at survey no.180/1, Village Kharivali, Taluka Wada, District Palghar. Said facility is availed for Resort Division. Term loan 1 (GECL) is having repayment period of 72 months with 24 month of moratoriam period. (O/s Rs.174.00 lacs) Rate of Interest - 11.45%. Term Loan - 3 is taken for expansion of resort is repayable in 66 months with moratoriam period of 12 months. (O/s Rs.72.01 lacs)
6. Overdraft facility from State Bank of India is secured by equitable mortgage on office premises situated at 301, Hubtown Solaris, N S Phadke Marg, Andheri East, Mumbai - 400069. Said facility is availed for Fertiliser Division.
7. Personal Guarantee of Shri.Yogendra D Patel and Smt. Anjni Y Patel, Promoter Director of the company are given against working capital facility for fertiliser Division. Personal Guarantee of Shri.Yogendra D Patel, Promoter Director of the company is given against working capital facility for Resort Division.
8. Vehicle loan is taken from HDFC Bank Ltd , Saraswat Co-op Bank Ltd and Mahindra Finance.(O/s Rs.148.37 lacs) Rate of interest -, Hypothecation of vehicles
9. Term loan - 2 from Saraswat Bank is taken for Project finance for construction of residential tower which is repayable in 57 months with moratoriam of 33 months O/s is Rs.564.45 lacs. Mortgage of land and building at Sector-5, S.No.112/2A, Majiwada, Thane.
10. Rate of Interest is in the range of 11.45% p.a. - 12.50% p.a (PY 9.25% p.a - 10.35% p.a)
Post Employement obligations Gratuity
The company provides for gratuity for employees in india as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of five years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by number of years of service.
(iii) Defined contribution plans
The company also has defined contribution plans. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the company is limited to the amount contributed and it has no further contractual nor any contructive obligation. The expense recognised during the period towards defined contribution plan is INR 4.86 Lakhs (March 31, 2022: INR 15.24 Lakhs)
(v) Terms and conditions of transactions with related parties
The transactions with related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables and payables. Forthe year ended March 31, 2023. This assessment is undertaken each financial yearthrough examining the financial position of the related party and market in which the related party operates.
No operating segments have been agrregated to form the above reportable operating segment.
The Managing Director (MD) monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the standalone financial statements. Also, the Company''s financing (including finance costs and finance income) and income taxes are managed on a Company basis (unallocable) and are not allocated to operating segments.
Adjustments and eliminations
Finance income and costs are not allocated to individual segments as the underlying instruments are managed on a group basis.
Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are also managed on a group basis.
Capital expenditure consists of additions of property,plant and equipment and intangible assets.
B. Information about geographical areas Revenue from external customers
The Company is domiciled and have operations only in India. Hence, there is no geographical segment. Accordingly, no disclosure is required under Ind AS 108 "Operating Segment".
The Company''s Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors is responsible for developing and monitoring the Company''s risk management policies.
The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
The finance team oversees how management monitors compliance with the company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.
The Company''s activity exposes it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the company manages the risk.
(A) Credit risk
Credit risk is the risk that risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk arises from cash and cash equivalents, financial assets carried at amortised cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.
(a) Trade and other receivables
Credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the company grants credit terms in the normal course of business.
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an throughout each reporting period. To assess whether there is a significant increase in credit risk the company compares the risk of a default occurring at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwardinglooking infor
A default on a financial asset is when the counterparty fails to make contractual payments of when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
i. Provision for expected credit losses
The company follows ''simplified approach'' for recognition of loss allowance on Trade receivables.
As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.
(b) Other Financial Assets
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
A default on a financial asset is when the counterparty fails to make contractual payments when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
The carrying amount of cash and cash equivalents, loans, deposits with banks and financial institutions and other financial assets represents the maximum credit exposure.
(B) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due. The Company consistently generated sufficient cash flows from operations to meet its financial obligations.
Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the company''s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements.
(C) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk and other price risk such as commodity price risk.
(i) Foreign currency risk
Foreign currency risk is the risk of impact related to fair value or future cash flows of an exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the import payables.
The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies and standard operating procedures to mitigate the risks.
(ii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The management is responsible for the monitoring of the Company'' interest rate position. Various variables are considered by the management in strucutring the Company''s borrowings to achieve a reasonable and competitive cost of funding.
However, during the periods presented in the financial statements, the Company has primarily borrowed funds under fixed interest rate arrangements with banks and financial institutions and therefore the Company is not significantly exposed to interest rate risk.
(iii) Inventory price risk
The company is exposed to the movement in price of principal finished product i.e Fertilizer. The main raw material i.e Rock Phosphate is imported from Egypt / Jordan and its price is variable depending upon exchange rate. Fertiliser being a seasonal as well as subsidized product; prices of fertilizer are monitered by government. Department of Fertilizer implemented "Direct Benefit Transferâ (DBT) system for eligibility of subsidy on sale of fertilizer through POS machines. Company monitors the fertilizer prices on daily basis and formulates the sales strategy to achieve maximum realisation.
For the purpose of the company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximise the shareholder value.
The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The company includes within debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents and other bank balances.
1 Debt Equity Ratio increased as debt of the company has increased during the year, borrowed funds are for real estate division and expansion of resort division.
2 Debt service coverage ratio was negative due to increased operating expenses.
3 Return on equity, Return on capital emplyed and Net Profit ratio has been affected due to losses of the company. Fertiliser division capacity utilization is less than 10% and increased overhead expenses has affected the performance of resort division.
4 Trade payables Turnover ratio increased due to purchases incurred in construction division (PY- Nil).
5 Net capital turnover ratio increased due to increase in turnover and increase in inventory, decrease in current borrowings and trade receivables.
6 Returns on Mutual funds and dividend has improved the Return on investment ratio.
42. In the opinion of the Board, any of the assets other than Property, Plant and Equipment , Intangible assets and non-current investments do not have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated.
46. There is no pending registration of charges or satisfaction of charges with Registrar of Companies.
47. Previous year''s amounts are regrouped and reclassified to make them comparable with current year''s classification, wherever necessary.
Mar 31, 2018
1 Corporate Information
These statements comprise financial statements of Bharat Agri Fert Realty Limited (referred to as âthe Companyâ) (CIN: L24100MH1985PLC036547) for the year ended March 31, 2018. The Company is a public company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its Equity shares are listed on Bombay Stock Exchange in India. The registered office of the company is located at 301, 3rd Floor, Hubtown Solaris, N S Phadke Marg, near Gokhale Bridge, Andheri (East), Mumbai - 400 069.
The Company is principally engaged in the business of construction and development of Residential and Commercial Complex and manufacture of fertilisers and operating Resort The financial statements were approved by the Board of Directors and authorised for issue on May 30, 2018.
Notes:
i. Property, Plant and Equipment given as collateral security against borrowings by the company
Refer to Note 36 for information on property, plant and equipment given as collateral security by the company.
ii. Contractual Obligations
Refer to Note 30 for disclosure of contractual commitments for the acquisition of property, plant and equipment.
The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liablities relate to income taxes levied by the same tax authority.
Considering the probability of availability of future taxable profits in the period in which tax losses expire, deferred tax assets have not been recognised in respect of tax credits carried forward by the Company.
Changes in tax rate
The increase in education cess from 3% to 4% was substantively enacted on February 1, 2018 and will be effective from April 1, 2018. As a result, the relevant deferred tax balance have been remeasured. The impact of the change in tax rate has been recognised in tax expense in profit or loss.
Terms/rights attached to equity shares
The company has only one class of equity shares having par value of I NR 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
During the year ended 31st March 2018, the amount of per share final dividend recognised as distributions to equity shareholders was Nil (P.Y final dividend Nil)
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.
iv. Aggregate number of equity shares issued as bonus, shares issued for consideration other than cash and shares bought back during the period of five years immediately preceding the reporting date: NIL (previous period of five years ended march 31, 2017 : NIL)
v. None of the above shares are reserved for issue under options/contract/commitments for sale of shares or disinvestment.
Current Borrowings
Terms of Conditions of Repayment and Details of Securities are as under :
1. The loan is Repayable on demand.
2. Cash Credit loan is secured by hypothecation of stock of raw material, semi-finished goods and stores and spares, packing material, finished goods , receivables (both present and future).
3. Cash Credit loan is secured by equitable mortgage on factory Land(measuring 18.36 acre) and buildings situated at village Kharivali, Taluka-Wada, District-Palghar.
4. Cash Credit loan is secured by hypothecation of Plant and machinery and all other movable fixed Property, Plant and Equipment of the Company already in possession or to be in possession of the Company.
5. Cash Credit loan is secured by Personal guarantee of Shri Yogendra D. Patel (Promoter Director)and Anjni Y. Patel (Promoter Director)
6. Rate of Interest is 11.00% p.a. (March 31, 2017: 12.10%)
Post Employment obligations
Gratuity
The company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of five years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied by number of years of service.
The average duration of the defined benefit plan obligation at the end of the reporting period is 11.72 years (March 31, 2017: 12.89 years)
(iii) Defined contribution plans
The company also has defined contribution plans. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident fund administered by the government. The obligation of the company is limited to the amount contributed and it has no further contractual nor any contructive obligation. The expense recognised during the period towards defined contribution plan is INR 17.30 Lakhs (March 31, 2017: I NR 14.60 Lakhs)
*The amount of post employment benefits and long term employee benefits cannot be separately identified from the composit figure advised by the actuary/valuer.
(vi) Terms and conditions of transactions with related parties
The transactions with related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables and payables. For the year ended March 31, 2018, the group has not recorded any impairment of receivables relating to amount owed by related parties (March 31, 2017: NIL). This assessment is undertaken each financial year through examining the financial position of the related party and market in which the related party operates.
2. SEGMENT REPORTING
A. For management purposes, the Company is organized into following three business units based on the risks and rates of returns of the products offered by these unit as per Ind AS 108 on âOperating Segment'' :
Construction
Fertilizers
Resort
No operating segments have been agrregated to form the above reportable operating segment.
The Managing Director (MD) monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on profit or loss and is measured consistently with profit or loss in the standalone financial statements. Also, the Company''s financing (including finance costs and finance income) and income taxes are managed on a Group basis and are not allocated to operating segments.
Transfer prices between operating segments are on an arm''s length basis in a manner similar to transactions with third parties.
Adjustments and eliminations
Finance income and costs, and fair value gains and losses on financial assets are not allocated to individual segments as the underlying instruments are managed on a group basis.
Current taxes, deferred taxes and certain financial assets and liabilities are not allocated to those segments as they are also managed on a group basis.
Capital expenditure consists of additions of property, plant and equipment and intangible assets.
B. Information about geographical areas Revenue from external customers
The Company is domiciled and have operations only in India. Hence, there is no geographical segment. Accordingly, no disclosure is required under Ind AS 108 âOperating Segmentâ.
The management assessed that the fair value of cash and cash equivalent, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short term maturities of these instruments.
The fair values for loans, deposits and other non current financial assets were calculated based on cash flows discounted using a current lending rate. They are classified as level 3 fair values in the Fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk.
The fair values of non current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.
ii. Fair Value Hierarchy
All assets and liabilities for which fair value is measured in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:
There have been no transfers among Level 1, Level 2 and Level 3 during the period Measurement
Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices.
Level 2 - The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3 - If one or more of the significant inputs are not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity shares included in level 3.
Iii. Valuation technique used to determine fair value
Specific Valuation techniques used to value financial instruments include:
- the use of quoted market prices or dealer quotes for similar instruments
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis iv. Valuation processes
The finance department of the company includes a team that performs the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values. This team reports directly to the chief financial officer (CFO) and the audit committee(AC). Discussions of valuation processes and results are held between the CFO, AC and the valuation team at least once every three months, in line with the company''s quarterly reporting periods.
3. FINANCIAL RISK MANAGEMENT
The Company''s Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The board of directors is responsible for developing and monitoring the Company''s risk management policies. The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and dherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
The audit committee and finance team oversees how management monitors compliance with the company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.
The Company''s activity exposes it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the company manages the risk.
(A) Credit risk
Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk arises from cash and cash equivalents, financial assets carried at amortised cost and deposits with banks and financial institutions, as well as credit exposures to customers including outstanding receivables.
(a) Trade and other receivables
Credit risk has always been managed by the company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the company grants credit terms in the normal course of business.
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
A default on a financial asset is when the counterparty fails to make contractual payments of when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
i. Provision for expected credit losses
The company follows ''simplified approach'' for recognition of loss allowance on Trade receivables.
As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analyzed.
(b) Other Financial Assets
The company considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the company compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
A default on a financial asset is when the counterparty fails to make contractual payments when they fall due. This definition of default is determined by considering the business environment in which entity operates and other macro-economic factors.
The carrying amount of cash and cash equivalents, loans, deposits with banks and financial institutions and other financial assets represents the maximum credit exposure. The maximum exposure to credit risk is I NR 2,390.63 Lakhs (March 31, 2017: INR 2,081.32 Lakhs, April 1, 2016: INR 2,217.65 Lakhs).
(B) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due. The Company consistently generated sufficient cash flows from operations to meet its financial obligations.Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the company''s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements.
Contractual maturities of financial liabilities
The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. In the table below, borrowings include principal cash flows.
C) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk and other price risk such as commodity price risk.
(i) Foreign currency risk
Foreign currency risk is the risk of impact related to fair value or future cash flows of an exposure in foreign currency, which fluctuate due to changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the import payables.
The Company evaluates exchange rate exposure arising from foreign currency transactions and follows established risk management policies and standard operating procedures to mitigate the risks.
(ii) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rates. The management is responsible for the monitoring of the Company'' interest rate position. Various variables are considered by the management in structuring the Company''s borrowings to achieve a reasonable and competitive cost of funding.
However, during the periods presented in the financial statements, the Company has primarily borrowed funds under fixed interest rate arrangements with banks and financial institutions and therefore the Company is not significantly exposed to interest rate risk.
(iii) Inventory price risk
The company is exposed to the movement in price of principal finished product i.e Fertilizer. The main raw material i.e Rock Phosphate is imported from Egypt and its price is variable depending upon exchange rate. Fertiliser being a seasonal as well as subsidized product; prices of fertilizer are monitered by government. During current financial year, Department of Fertilizer implemented âDirect Benefit Transferâ (DBT) system for eligibility of subsidy on sale of fertilizer through POS machines. Company monitors the fertilizer prices on daily basis and formulates the sales strategy to achieve maximum realisation.
4. CAPITAL MANAGEMENT
For the purpsoe of the company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximise the shareholder value.
The company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The company includes within debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents and other bank balances.
In order to achieve the objective of maximize shareholders value, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing borrowings that define capital structure requirements.
5. DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS DEFINED UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006 (MSMED ACT, 2006)
The details in respect of Enterprises covered/ registered under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) are not available with the Company. Hence, the details of the principal amounts and interest, if any, payable to the suppliers as on March 31, 2018 have not been furnished.
6. STANDARDS ISSUED BUT NOT YET EFFECTIVE
Ind AS 115 - Revenue from Contracts with Customers
Ind AS 115 was issued in February 2016 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115 revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. The new revenue standard will supersede all current revenue recognition requirements under Ind AS. This standard will come into force from accounting period commencing on or after April 1, 2018. The Company will adopt the new standard on the required effective date.
7. FIRST TIME ADOPTION OF IND AS
These are the company''s first financial statements prepared in accordance with Ind AS. The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS balance sheet at April 1, 2016 (the Company''s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the company''s financial position, financial performance and cash flows is set out in the following tables and notes.
A. Exemptions and exceptions availed
Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.
1. Ind AS optional exemptions
i. Deemed cost
Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment and intangible assets covered by Ind AS 38 - Intangible Assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.
ii. Estimates
The estimates at April 1, 2016 and at March 31, 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from Impairment of financial assets based on expected credit loss model.
The estimates used by the company to present these amounts in accordance with Ind AS reflect conditions at April 1, 2016, the date of transition to Ind AS and as of March 31, 2017.
iii. Investments in associates
In separate financial statements, a first-time adopter that subsequently measures an investment in a associate at cost , may measure such investment at cost (determined in accordance with Ind AS 27) or deemed cost (fair value or previous GAAP carrying amount) in its separate opening Ind AS balance sheet. Selection of fair value or previous GAAP carrying amount for determining deemed cost can be done for each subsidiary, associate and joint venture. The company elects to carry its investments in associates at previous GAAP carrying amount as deemed cost.
iv. Classification and measurement of financial assets
Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS. Accordingly, the classification and measurement of financial assets have been done on the basis of the facts and circumstances that existed at the date of transition and end of comparative year.
B. Reconciliations between previous GAAP and Ind AS
Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.
vi. Impact of Ind AS adoption on the statements of cash flows for the year ended March 31, 2017
There are no material adjustments to the Statement of Cash flows as reported under the previous GAAP.
C. Notes to first-time adoption:
Note 1: Deferred tax
Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP.
In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the company has to account for such differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or a separate component of equity.
Note 2: Borrowings
Under the previous GAAP, interest free borrowings from related parties are recorded at their transaction value. Under Ind AS, all financial liabilities are required to be recognised at fair value on initial recognition. Accordingly, the company has fair valued the interest free borrowings and the difference between the fair value and transaction value has been recognised in retained earnings on the date of transition.
Note 3: Excise duty
Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented as other expenses in the statement of profit and loss.
Note 4: Remeasurements of post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year.
Note 5: Retained earnings
Retained earnings as at April 1, 2016 has been adjusted consequent to the above Ind AS transition adjustments.
Note 6: Other comprehensive income
Under Ind AS, all items of income and expense recognised in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the statement of profit and loss as ''other comprehensive income'' includes remeasurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP
Mar 31, 2016
1. Rights, preferences and restrictions attached to shares Equity Shares:
The Company has only one class of shares referred to as equity shares having a par value of 10/-. Each holder of equity shares is entitled to one vote per share.
The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
During the year ended 31st March, 2016, the amount of per share final dividend recognized as distributions to equity shareholders was Nil ( P.Y. final dividend Rs. 1.50/-)
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.
Terms of Conditions of Repayment and Details of Securities are as under :
2. The loan is Repayable on demand.
3. Cash Credit loan is secured by hypothecation of stock of raw material, semi-finished goods and stores & spares, packing material, finished goods , receivables (both present and future)
4. Cash Credit loan is secured by equitable mortgage on factory Land(measuring 18.36 acre) and buildings situated at village Kharivali, Tal-Wada, Dist-Palghar.
5. Cash Credit loan is secured by hypothecation of Plant and machinery and all other movable fixed assets of the Company already in possession or to be in possession of the Company.
6. Cash Credit loan is secured by Personal guarantee of Shri Yogendra D. Patel (Promoter Director) and Anjni Y. Patel (Promoter Director)
7. Rate of Interest is 12.15% p.a. (P.Y. 13.00%)
8. The details in respect of Enterprises covered/registered under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) are not available with the Company. Hence the details of the principal amounts and interest, if any, payable to the suppliers as on 31st March, 2016 have not been furnished.
9. Contingent Liabilities:
The company do not have any pending litigation and continent liability as at 31st March,2016.
10. Commitments: Estimated amount of contracts on capital accounts remaining to be executed and not provided for is Rs.22,21,098/- (P.Y.Rs. 34,10,000/-).
11. The Company has not accounted for Society''s Common Maintenance Charges Rs.1,15,04,340/- for the year ended 31st March, 2016. as the matter is subjudice.
The Company has outstanding receivables on account of said Society Maintenance Charges Rs.1,14,83,512/-/- as at 31st March, 2016.
The Company has filed civil suit at Thane Court in respect of recovery of these Society Maintenance Charges. Management of the Company is hopeful about positive outcome of the said civil suit. Accordingly no provision has been made in the books of Accounts.
12. The values of Current Assets and Loans & Advances and Deposits are stated at value which is the opinion of the Management of the Company is realizable in the ordinary course of the business, of the Company.
13. Retirement Benefits
14. Defined Benefit Plan: The Company has provided for Gratuity on the basis of Actuarial valuation. The Company does not have any fund for Gratuity Liability.
The following table summarized the net benefit / Expenses recognized in Statement of Profit &Loss and Balance Sheet.
15. The Company has two reportable primary business segments namely Construction and Fertilizer. Business segment has been considered as primary segment. Details of primary segment disclosure are as follows.
16. The Construction Segment includes construction and sale of residential and commercial units. The Fertilizer segment includes manufacturing and sale of Single Super Phosphate (SSP) in Powder and Granulated form
17. Entire consumption of stores & spares is indigenous for the financial year ended 31st March, 2016 and previous financial year.
18. Previous year''s figures are regrouped and reclassified wherever necessary to make them comparables with current period''s classification.
Mar 31, 2015
OVERVIEW:
The Company is engaged in the business of construction and development
of Residential & Commercial Complex and manufacture of Fertilisers.
1. The details in respect of Enterprises covered/registered under
Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act)
are not available with the Company. Hence the details of the principal
amounts and interest, if any, payable to the suppliers as on 31st March
2015 have not been furnished.
1. The Company does not expect any reimbursements in respect of claim
against the Company not acknowledged as a debt.
2. It is not practicable to estimate the timing of cash flows, if any,
in respect of matters claim against the Company not acknowledged as a
debt.
ii) Commitments: Estimated amount of contracts on capital accounts
remaining to be executed and not provided for is Rs.34,10,000/-
(P.Y.Rs.18,95,000/-). 30. The Company has accounted for Society's
Common Maintenance Charges Rs.89,46,177/- (Previous Years
Rs.28,10,148/-). The Company has outstanding receivables on account of
said Society Maintenance Charges Rs. l,14,83,512/-(Previous Years Rs.
27,98,520/-)
The Company has filled civil suit at Thane Court in respect of recovery
of these Society Maintenance Charges. Management of the Company is
hopeful about positive outcome of the said civil suit. Accordingly no
provision has been made in the books of Accounts.
2. The values of Current Assets and Loans & Advances and Deposits are
stated value which is the opinion of the Management of the Company is
realisable in the ordinary course of the business, of the Company.
3. Retirement Benefits
a) Defined Benefit Plan: The Company Provides for Gratuity on the basis
of Actuarial valuation. The Company does not have any fund for Gratuity
Liability. The following table summarized the net benefit / Expenses
recognised in Statement of Profit & Loss and Balance Sheet.
4. Excise Duty has not been provided on Closing stock Inventory.
This, however do not have any impact on profit of the Company.
5. Entire consumption of stores & spares is indigenous for the
financial year ended 31st March 2015 and previous financial year.
6. Previous year's figures are regrouped and reclassified wherever
necessary to make them comparables with current period's
classification.
Mar 31, 2014
1.OVERVIEW:
The Company is engaged in the business of construction and development
of Residential & Commercial Complex and manufacture of Fertilizers.
a. Rights, preferences and restrictions attached to shares Equity
Shares:
The Company has only one class of shares referred to as equity shares
having a par value of 10/-. Each holder of equity shares is entitled to
one vote per share.
The Company declares and pays dividends in Indian rupees.The dividend
proposed by the Board of Directors is subject to the approval of the
shareholders in the ensuing Annual General Meeting.
During the year ended 31st March 2014, the amount of per share final
dividend recognised as distributions to equity shareholders was Rs.
2.50/-per share( P.Y. final dividend Rs.2.50/-)
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.
As per records of the Company, including its register of
shareholders/members and other declaration received from shareholders
,regarding beneficial interest,the above shareholding represents both
legal and beneficial ownership of the above shareholding.
2.Terms of Conditions of Repayment and Details of Securities are as
under:
1. The loan is Repayable on demand.
2. Cash Credit loan is secured by hypothecation of stock of raw
material, semi-finished goods and finished goods , receivables (both
present and future)
3. Cash Credit loan is secured by hypothecation of goods covered by
bill supported by document to title of goods.
4. Cash Credit loan is secured by equitable mortgage on factory
Land(measuring 18.36 acre) and buildings situated at village Kharivali,
Tal-Wada, Dist-Thane.
5. Cash Credit loan is secured by hypothecation of Plant and machinery
and all other movable fixed assets of the Company already in possession
or to be in possession of the Company.
6. Cash Credit loan is secured by Personal guarantee of Shri Yogendra
D. Patel (Promoter Director) and Anjni Y Patel (Promoter Director)
7. Rate of Interest is 13.00% p.a. (P.Y. 15.60%)
3. The details in respect of Enterprises covered/registered under
Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act)
are not available with the Company. Hence the details of the principal
amounts and interest, if any, payable to the suppliers as on 31st March
2014 have not been furnished.
4. Contingent Liabilities:
A. Letter of Credit issued outstanding as at 31st March 2014
Sn. Particulars As at 31st As at 31st
March 2014 March 2013
1. LC opened with Bank of Baroda 10,60,43,735 Nil
B i) Claims against the Company not acknowledged as a debt:
1. Maharashta State Electricity Board 16,04,084 16,04,084
ii) Commitments: Estimated amount of contracts on capital accounts
remaining to be executed and not provided for is Rs.18,95,000/-
(P.Y.Rs.5,88,500/-).
5. The values of Current Assets and Loans & Advances and Deposits are
stated values which is the opinion of the Management of the Company are
realizable in the ordinary course of the business, of the Company.
6. Retirement Benefits
a) Defined Benefit Plan: The Company Provides for Gratuity on the basis
of Actuarial valuation.The Company does not have any fund for Gratuity
Liability.
The following table summerised the net benefit Expenses recognised in
Statement of Profit & Loss and Balance Sheet.
7. Excise Duty has not been provided on Closing stock Inventory. This,
however do not have any impact on profit of the Company.
8. Entire consumption of Stores & Spares is indigenous for the
current and previous financial years.
9. Previous year''s figures are regrouped and reclassified wherever
necessary to make them comparables with current period''s
classification.
Mar 31, 2013
OVERVIEW:
The Company is engaged in the business of construction and development
of Residential & Commercial Complexes and manufacture of Fertilisers.
1. The details in respect of Enterprises covered/registered under
Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act)
are not available with the Company. Hence the details of the principal
amounts and interest, if any, payable to the suppliers as on 31st March
2013 have not been furnished
2. Contingent Liabilities:
i) Claims against the Company not acknowledged as a debt:
As at 31st March As at 31st March
Sl
No Particulars 2013 2012
1. Maharashta State 16,04,084 16,04,084
Electricity Board
ii) Commitments: Estimated amount of contracts on capital accounts
remaining to be executed and not provided for is Rs.5,88,500/-
(P.Y.Rs.Nil).
3. The values of Current Assets and Loans & Advances and Deposits are
stated values which is the opinion of the Management ofthe Company are
realizable in the ordinary course ofthe business, ofthe Company.
4. Retirement Benefits
a) Defined Benefit Plan: The Company Provides for Gratuity on the basis
of Actuarial valuation. The Company does not have any fund for Gratuity
Liability.
The following table summerised the net benefit / Expenses recognised in
Profit & Loss A/c and Balance Sheet.
5. Excise Duty has not been provided on Closing stock Inventory. This,
however do not have any impact on profit of the Company.
6. Director''s Remuneration aggregating to Rs.20,38,476/- provided in
the books of accounts, which is payable to the Chairman & Managing
Director and the Joint managing Director is in excess ofthe limit
specified under section 198 read with Schedule XIII ofthe Companies
Act, 1956.The above remuneration has been already approved by
Remuneration Committee. Said provision is subject to approval of the
Shareholder in ensuing Annual General Meetings.
7. Previous year''s figures are regrouped and reclassified wherever
necessary to make them comparables with current period''s
classification.
Mar 31, 2012
1. The details in respect of Enterprises covered/registered under
Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act)
are not available with the Company. Hence the details of the principal
amounts and interest, if any, payable to the suppliers as on 31st March
2012 have not been furnished.
2. Contingent Liabilities:
i) Claims against the Company not acknowledged as a debt:
(Amt. in Rupees)
Sn. Particulars 2011-2012 2010-2011
1. Maharashta State
Electricity Board 16.04,084 16.04.084
ii) Commitments: Estimated amount of contracts on capital accounts
remaining to be executed and not provided for is Rs.Nil
(P.Y.Rs.16,59,000/-).
3. The values of Current Assets and Loans & Advances and Deposits are
stated values which is the opinion of the Management of the Company are
realizable in the ordinary course of the business, of the Company.
4. During the previous year the Company did not import any raw
material, stores & spares.
Accordingly the Company has not incurred any expenditure in foreign
currency for the said purpose.
5. The Company has converted land situated at Thane into stock in
trade, up to 31 Dec. 2010 The proportionate sales proceeds relating to
such conversion were accounted for in Capital Receipt Reserve. The
Company was legally advised that the said receipts should be credited
to the Profit and Loss Account. The Company has accordingly changed the
method of accounting from 01/01/2011.
6. The amount of Capital Receipt Reserve for the year 2008-09 and
2009-10 amounting to Rs. 6.47 Crores, is credited to the Profit & Loss
as prior period income in the financial year 2010-2011.
7. Excise Duty has not been provided on Closing stock Inventory. This,
however do not have any impact on profit of the Company.
8. The Revised Schedule VI has become effective from 1st April 2011
for the preparation of financial statements. This has significantly
impacted the disclosure and presentation made in the financial
statements. Previous year's figures have been regrouped / reclassified
wherever necessary to correspond with the current year's classification
/ disclosure.
Mar 31, 2011
OVERVIEW:
The Company is engaged in the business of construction and development
of Residential & Commercial Complexes and manufacture of Fertilisers.
A) The details in respect of Enterprises covered/registered under
Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act)
are not available with the Company. Hence the details of the principal
amounts and interest, if any, payable to the suppliers as on 31st March
2011 have not been furnished.
B) Contingent Liabilities:
i) Claims against the Company not acknowledged as a debt:
(Amt. Rs. In lacs)
Sr. Particulars 2010-2011 2009-2010
No
1 Maharashtra State
Electricity Board 16.04 16.04
C) The values of Current Assets and Loans & Advances and Deposits are
stated values which is the opinion of the Management of the Company are
realizable in the ordinary course of the business, of the Company.
ii) The Company is operating in India hence there is no reportable
geographic/secondary segment. Accordingly no disclosure is required
under AS-17
E) Disclosure of Related Party:
a. List of Related Parties:
Subsidiary Companies None
Associate Concerns 1. Yogi Investments Private Limited
2. Vijal Shipping Private Limited
3. Wada Agro Chemicals Private Limited
4. Wada Bottling Industries Private Limited
5. Patel Combi-Therm (India) Private Limited
6. Chavi Impex Private Limited
7. Wada Alums and Acids Private Limited
8. My Shop
Key Management Shri.Y.D.Patel .-Chairman & Managing Director
Personnel
Relatives of Key Smt. AnjniY. Patel, Jt. Mg. Director
Management Personnel Miss. Chandni Y. Patel, Director
Shri.Shailendra D. Patel, CEO (Fertiliser
Division)
Shri. ViialY.Patel.CEO
(Construction Division)
7. During the previous year the Company did not import any raw material
and stores & spares and other expenses. Accordingly the Company has not
incurred any expenditure in foreign currency forsaid purpose.
I) The Company has converted land situated at Thane into stock in
trade. The proportionate sales proceeds relating to such conversion
were accounted for in Capital Receipt Reserve. The Company has now been
legally advised that the said receipts should be credited to the Profit
and Loss Account. The Company has accordingly changed the method of
accounting from 01/01/2011.
J) The amount of Capital Receipt Reserve for the year 2008-09 and
2009-10 amounting to Rs. 6.47 Crores, is credited to the Profit & Loss
as prior period income.
K) Due to the change in the accounting policy as mentioned in points
"I" & "J", the sales for the year ended 31 st March 2011, are not
comparable with previous year.
L) Estimated amount of contracts on capital accounts remaining to be
executed and not provided for is Rs. 16.59 Lacs (P.Y.Rs.11.18Lacs).
M)The figures of the previous year have been re-grouped and rearranged
wherever necessary so as to make them comparable with those of the
current financial year.
Mar 31, 2010
A) The details in respect of Enterprises registered under Micro, Small
and Medium
Enterprises Development Act, 2006 (MSMED Act) are not available with
the Company. Hence the details of the principal amounts and interest,
if any, payable to the suppliers as on 31st March 2010 have not been
furnished.
B) Contingent Liabilities:
i) Claims against the Company not acknowledged as a debt: (Amt. Rs. In
lacs)
Sr.
No Particulars 2009-2010 2008-2009
1 MSEB Claim 16.04 16.04
ii) Estimated amount of contracts remaining to be executed on capital
account and not provided forRs.11.18lacs(P.Y.Rs.Nil)
C) The values cf Current Assets and loans & Advances and deposits are
stated at realizable in ordinary course of the business, as stated in
balance sheet as per the opinion of the Management of the Company. 34
D) Disclosure of Related Party: a. List of Related Parties:
Subsidiary Companies None
Associate Concerns 1. Yogi Investments Pvt. Ltd
2. Vijal Shipping Pvt Ltd.
3. WadaAgro Chemicals Pvt. Ltd.
4. Wada Bottling Industries Pvt. Ltd.
5. Patel Combi-Therm (India) Pvt. Ltd.
6. Chavi Impex Pvt. Ltd.
7. Wada Alums and Acids Pvt Ltd.
Key Management Shri.Y.D.Patel .-Managing Director
Personnel
Relatives of Key Smt. Anjni Y. Patel, Jt. Mg. Director
Management Personnel Miss. Chandni Y Patel,
Director
-In view of substantial brought forward losses, the deferred tax asset
has not been recognized in view of virtual uncertainty of profit in the
immediate future.
- During the previous year, initial recognition of deferred tax
liability amounting to Rs. 58, 07,521/- has been added to balance in
Profit and Loss account.
E) The Company has written off goodwill amounting to Rs. Nil (RY. Rs.
1,56,97,409/-) as per AS- 10.Accounting for Fixed Assets as said
goodwill had been resulted on amalgamation of manufacturing division of
Wada Alums and Acids Private Limited with Bharat Fertilizers Limited
and no consideration has been received for the same.
F) Fertiliser Division : Disclosure of additional information pursuant
of the provisions of paragraph 3,4C and 4D of part II Schedule VI to
the Companies Act, 1956, to the extent applicable.
G) The company has converted land into stock in trade. The
proportionate sale proceeds relating to such conversion is accounted
for in the capital reserve. This accounting treatment is based on
expert opinion obtained by the Company.
H) The figures of the previous year have been re-grouped and rearranged
wherever necessary so as to make them comparable with those of the
current financial year.
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