Notes to Accounts of Satellite Engineering Ltd.

Mar 31, 2012

1 CORPORATE INFORMATION

Satellite Engineering Ltd. (the Company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company is a leading vertically integrated Indian Electrical company with global operations, engaged in the development, manufacture and marketing of Lighting products and accessories and are headquartered in India. Company has manufacturing locations situated at Gujarat, i.e. Ahmedabad and Gandhidham.

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Mar 31, 2011

1. Previous year figures have been regrouped/ rearranged wherever necessary and have been rounded off to the nearest rupee.

2. Contingent liabilities not provided for:

a) Income Tax and Sales tax liability that may arise on final assessment of pending assessment.

3. No provision has been made for the accrued gratuity liability payable to the employees in the future as the company follows the method of accounting for the same as and when the gratuity is payable on retirement. In the absence of actuarial valuation report, the estimated amount for the same is not ascertainable.

4. The company has yet to obtain balance confirmations from debtors, creditors and the parties to whom advances and deposits have been given. Adjustments, if necessary, will be made after the confirmations are received.

5. Wherever supporting documents are not available, the auditors have relied on Management's Representation.

6. On the basis of the information furnished, the company does not owe any amount for more than 30 days to Small Scale Industrial units.

7. Some of the old items of Plant & Machinery of Kathwada Division were sold during the year at Rs.4,00,000/-, which is credited to Profit & Loss account as 'Profit on Sale of Machine Parts', in absence of original cost and accumulated depreciation of such machinery/machinery part sold. Due to this accounting treatment, the profit for the year and the depreciation on such sold Plant & Machinery are overstated. The quantification of both these amounts is not ascertainable.

8. Profit and Loss Account includes the following remuneration to the Managing Director.

Particulars 2010-2011 2009-2010

(i) Salary Nil 1,20,000/-

(ii) Perquisites

(iii) Contribution Nil 9,360/-

9. a. Licensed capacity Not Applicable b. Installed capacity Not Applicable

10. Employee Benefits:

As there is only one employee, actuarial valuation of employee benefits was not got done by the Company. Moreover, Directors have not drawn any remuneration during the year under review.

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Mar 31, 2009

1. Previous year figures have been regrouped/ rearranged wherever necessary and have been rounded off to the nearest rupee.

2. Contingent liabilities not provided for:

a) Income Tax and Sales tax liability that may arise on final assessment of pending assessment.

3. No provision has been made for:

a. The accrued gratuity liability payable to the employees in the future as the company follows the method of accounting for the same as and when the gratuity is payable on retirement. In the absence of actuarial valuation report Total Gratuity Liability as on 31-3-2009 payable in the future is estimated as Rs. 1,84,850/-.

b. Debts considered doubtful amounting to Rs. 22,72,461/-

4. The company has yet to obtain balance confirmations from debtors, creditors and the parties to whom advances and deposits have been given. Adjustments, if necessary, will be made after the confirmations are received.

5. On the basis of the information furnished, the company does not owe any amount for more than 30 days to Small Scale Industrial units.

6. Some of the old items of Plant & Machinery of Gandhidham Division were sold during the year at Rs. 50,000/-, which is credited to Profit & Loss account as profit on sale of assets in absence of original cost and accumulated depreciation of such machinery sold. Due to this accounting treatment, the loss for the year is understated and the depreciation on such sold Plant & Machinery is overstated. The quantification of both these amounts is not ascertainable.

7. a. Licensed capacity Not Applicable

b. Installed capacity Not Applicable

8.Employee Benefits:

As there is only one employee (apart from two directors drawing remuneration) actuarial valuation of employee benefits was not got done by the Company.

9. Related Party Disclosure:

Related party disclosure as required by Accounting Standard-18 on "Related party disclosures" are given below: i. List of Related Parties

1. Associates.

a. Aniket Electrical P. Ltd

b. Vashishta Electrical & Electronics P. Ltd

c. Anand Associates

2. Key Management personnel and Relatives:

a. Mr. Anand A. Shah

b. Mrs. Snehvina A. Shah

c. Mrs. Avani Anand Shah

d. Mr. Aniket Anand Shah

10. Deferred tax Asset/ Liability

In accordance with Accounting standards-22 (AS-22) on Accounting for taxes on Income issued by the Companies (Accounting Standards) Rules, 2006, the Company has provided for the current years tax, if, any at the current tax rates based on assessable income and for the deferred tax at the tax rates that have been enacted or substantively enacted by Balance Sheet date based on the tax effect on timing differences resulting from the recognition of the items in the financial statements and in estimating its current tax provision. However, as there is no reasonable certainty of realization, deferred tax assets have not been recognized.