Notes to Accounts of Ugar Sugar Works Ltd.

Mar 31, 2025

(r) PROVISIONS

Provisions are recognized when the Company has a present legal or constructive obligation as a
result of past events, it is probable that an outflow of resources will be required to settle the
obligation and the amount can be reliably estimated. Provisions are not recognized for future
operating losses.

Provisions are measured at the present value of management’s best estimate of the expenditure
required to settle the present obligation at the end of the reporting period. The discount rate used
to determine the present value is a pretax rate that reflects current market assessments of the
time value of money and the risks specific to the liability. The increase in the provision due to the
passage of time is recognized as interest expense.

CONTINGENT LIABILITIES

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events
but their existence will be confirmed by the occurrence or non-occurrence of one or more
uncertain future events not wholly within the control of the Company or where any present
obligation cannot be measured in terms of future outflow of resources or where a reliable estimate
of the obligation cannot be made.

(s) FINANCIAL INSTRUMENTS

A financial instrument is any contract that gives rise to a financial asset of one entity and a
financial liability or equity instrument of another entity.

Financial assets and liabilities are recognised when the Company becomes a party to the
contractual provisions of the instruments and are initially measured at fair value. Transaction
costs that are directly attributable to the acquisition or issue of financial assets and liabilities
(other than financial assets and financial liabilities at fair value through profit or loss) are added to
or deducted from the fair value of the financial assets or liabilities on initial recognition.
Transaction costs directly attributable to the acquisition of financial assets or financial liabilities
at fair value through profit or loss are recognised immediately in profit or loss.

Financial assets

Initial Recognition and measurement

All financial assets are recognized initially at fair value plus, in the case of financial assets not
recorded at fair value through profit or loss, transaction costs that are attributable to the
acquisition of the financial asset

However, trade receivables that do not contain a significant financing component are measured at
transaction price.

Classification and subsequent measurement

For the purpose of subsequent measurement, financial assets are classified in four categories :

• Debt instruments at amortized cost

• Debt instruments at fair value through other comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity instruments at fair value through profit or loss
(FVTPL)

• Equity instruments measured at fair value through other comprehensive income (FVTOCI)
Debt instruments at amortized cost

A ‘debt instrument'' is measured at the amortised cost if both the following conditions are met:

a) The asset is held within a business model whose objective is to hold assets for collecting
contractual cash flows, and

b) Contractual terms of the asset give rise on specified dates to cash flows that are solely
payments ofprincipal and interest (’SPPI’) on the principal amount outstanding.

After initial measurement, such financial assets aresubsequently measured at amortised cost
using the effective interest rate (’EIR’) method. Amortised costis calculated by taking into account
any discount or premium on acquisition and fees or costs that are anintegral part of the EIR. The
EIR amortisation is included in other income in the statement of profit andloss. The losses arising
from impairment are recognised in the statement of profit and loss. This categoiygenerally applies
to trade and other receivables.

Debt instruments at FVTPL

FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the
criteria for categorisation as at amortised cost or as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate a debt instrument, which otherwise meets
amortisedcost or FVTOCI criteria, as at FVTPL. However, such election is allowed only if doing so
reduces oreliminates a measurement or recognition inconsistency (referred to as ''accounting
mismatch'').

Debt instruments included within the FVTPL category are measured at fair value with all changes
recognised in the P&L.

Equity investments

All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments
which are heldfor trading and contingent consideration recognised by an acquirer in a business
combination to whichlnd AS 103 Business Combinations applies are classified as at FVTPL. For all
other equity instruments, theCompany may make an irrevocable election to present in other
comprehensive income subsequentchanges in the fair value. The Company makes such election on
an instrument by- instrument basis. Theclassification is made on initial recognition and is
irrevocable.If the Company decides to classify an equity instrument as at FVTOCI, then all fair
value changes on theinstrument, excluding dividends, are recognized in the OCI. There is no
recycling of the amounts fromOCIto P&L, even on sale of investment. However, the Company may
transfer the cumulative gain or loss withinequity.

Equity instruments included within the FVTPL category are measured at fair value with all
changesrecognized in the P&L.

Investment in equity shares, compulsorily convertible debentures and compulsory convertible
preferenceshares of subsidiaries, associates and joint ventures have been measured at cost less
impairmentallowance, if any.

De- recognition

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar
financialassets) is primarily derecognized (i.e. removed fromthe Company''s balance sheet) when:

• The rights to receive cash flows from the asset have expired, or

• The Company has transferred its rights to receive cash flows from the asset or has assumed
an obligation to pay the received cash flows in full without material delay to a third party
under a ''pass through ‘arrangement; and either:

a) The Company has transferred substantially all the risks and rewards of the asset, or

b) The Company has neither transferred nor retained substantially all the risks and rewards of
theasset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and
rewards of ownership. When it has neither transferred nor retained substantially all of the risks
and rewards of the asset, nor transferred control of the asset, the Company continues to recognise
the transferred asset to the extent of the Company''s continuing involvement. In that case, the
Company also recognises an associated liability. The transferred asset and the associated liability
are measured on a basis that reflects the rights and obligations that the Company has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured
at the lower of the original carrying amount of the asset and the maximum amount of
consideration that the Company could be required to repay.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for
measurement and recognition of impairment loss on the following financial assets and credit risk
exposure:

a) Financial assets that are debt instruments, and are measured at amortised cost e.g., loans,
debtsecurities, deposits, trade receivables and bank balance

b) Financial assets that are debt instruments and are measured as at FVTOCI

c) Trade receivables or any contractual right to receive cash or another financial asset that
result from transactions that are within the scope of Ind AS 115 Revenue from Contracts with
Customers.

d) Loan commitments which are not measured as at FVTPL

e) Financial guarantee contracts which are not measured as at FVTPL

The Company follows ''simplified approach'' for recognition of impairment loss allowance on trade
receivables or contract revenue receivables. The application of simplified approach does not
require the Company to track changes in credit risk. Rather, it recognises impairment loss
allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

For recognition of impairment loss on other financial assets and risk exposure, the Company
determines that whether there has been a significant increase in the credit risk since initial
recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for
impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a
subsequent period, credit quality of the instrument improves such that there is no longer a
significant increase in credit risk since initial recognition, then the entity reverts to recognising
impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the
expected life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which
results from default events that are possible within 12 months after the reporting date.

ECL is the difference between all contractual cash flows that are due to the Company in
accordance with the contract and all the cash flows that the entity expects to receive (i.e., all cash
shortfalls), discounted at the original EIR. When estimating the cash flows, an entity is required to
consider:

• All contractual terms of the financial instrument (including prepayment, extension, call and
similar options) over the expected life of the financial instrument. However, in rare cases
when the expected life of the financial instrument cannot be estimated reliably, then the
entity is required to use the remaining contractual term of the financial instrument.

• Trade receivables do not carry any interest and are stated at their nominal value as reduced
by appropriate allowances for estimated irrecoverable amounts. Estimated irrecoverable
amounts are based on the ageing of the receivables balance and historical experience.
Individual trade receivables are written off when management deems them not to be
collectable.

ECL impairment loss allowance (or reversal) recognised during the period is recognised as income
/expense in the statement of profit and loss. This amount is reflected under the head ''other
expenses'' in the profit and loss. The balance sheet presentation for various financial instruments
is described below:

Financial assets measured as at amortised cost and contractual revenue receivables:

ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in
thebalance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off
criteria, the Company does not reduce impairment allowance fromthe gross carrying amount.

• Loan commitments and financial guarantee contracts:ECL is presented as a provision in
thebalance sheet, i.e. as a liability.

• Debt instruments measured at FVTOCI: Since financial assets are already reflected at fair
value, impairment allowance is not further reduced from its value. Rather, ECL amount is
presented as accumulated impairment amount'' in the OCI.

For assessing increase in credit risk and impairment loss, the Company combines financial
instruments on the basis of shared credit risk characteristics with the objective of facilitating an
analysis that is designed to enable significant increases in credit risk to be identified on a timely
basis.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through
profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments
in an effective hedge, as appropriate. All financial liabilities are recognised initially at fair value
and, in the case of loans and borrowings and payables, net of directly attributable transaction
costs.

The Company''s financial liabilities include trade and other payables, loans and borrowings
including bank overdrafts, financial guarantee contracts and derivative financial instruments.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

Loans and receivables: Loans and receivables are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. Loans and receivables are initially
recognized at fair value and subsequently measured at amortized cost using the effective interest
method, less provision for impairment.

De-recognition

A financial liability is de -recognised when the obligation under the liability is discharged or
cancelled or expires. When an existing financial liability is replaced by another from the same
lender on substantially different terms, or the terms of an existing liability are substantially
modified, such an exchange or modification is treated as the de recognition of the original liability
and the recognition of a new liability. The difference in the respective carrying amounts is
recognised in the statement of profit and loss.

Reclassification of financial assets and liabilities

The Company determines classification of financial assets and liabilities on initial recognition.
After initial recognition, no reclassification is made for financial assets which are equity
instruments and financial liabilities. For financial assets which are debt instruments, a
reclassification is made only if there is a change in the business model for managing those assets.
Changes to the business model are expected to be infrequent. The Company''s senior management
determines change in the business model as a result of external or internal changes which are
significant to the Company''s operations. Such changes are evident to external parties. A change in
the business model occurs when the Company either begins or ceases to perform an activity that
is significant to its operations. If the Company reclassifies financial assets, it applies the
reclassification prospectively from the reclassification date which is the first day of the immediately
next reporting period following the change in business model. The Company does no trestate any
previously recognised gains, losses (including impairment gains or losses) or interest.

(t) CASH AND CASH EQUIVALENTS

For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes
cash on hand, bank overdraft, deposits held at call with financial institutions, other short-term
highly liquid investments with original maturities of three months or less that are readily
convertible to known amounts of cash and which are subject to an insignificant risk of changes in
value.

(u) EARNINGS / (LOSS) PER SHARE

Basic earnings / (loss) per share are calculated by dividing the net profit / (loss) for the year
attributable to equity shareholders by the weighted average number of equity shares outstanding
during the year. The weighted average number of equity shares outstanding during the year are
adjusted for any bonus shares, share splits or reverse splits issued during the year and also after
the balance sheet date but before the date the financial statements are approved by the board of
directors. For the purpose of calculating diluted earnings / (loss) per share, the net profit / (loss)
for the year attributable to equity shareholders and the weighted average number of shares
outstanding during the year are adjusted for the effects of all dilutive potential equity shares.

The number of equity shares and potentially dilutive equity shares are adjusted for bonus shares,
share splits or reverse splits as appropriate. The dilutive potential equity shares are adjusted for
the proceeds receivable, had the shares been issued at fair value. Dilutive potential equity shares
are deemed converted as of the beginning of the year, unless issued at a later date.

(v) SEGMENT REPORTING

The Company’s Segment predominantly based on Sugarcane based produce and allied activities.
The Operational Segments constitute of Sugar, Industrial Alcohol, Potable Alcohol, Co -
Generation and Petroleum products Sale. As regards to Geographical Segments , the segments are
located at Ugarkhurd and Jewargi. Operating segments are reported in a manner consistent with
the internal reporting provided to the Chief Operating Decision Maker (CODM).

The Management Committee monitors the operating results of its business units separately for the
purpose of making decisions about resource allocation and performance management. Segment
performance is evaluated based on profit or loss and is measured consistently with the profit and
loss of financial statements.

The accounting policies adopted for segment reporting are in line with the accounting policies
adopted by the Company, with the following additional policies for segment reporting:

(i) Inter segment revenue has been accounted for based on the transaction price agreed to
between segments which is primarily market led.

(ii) Segment Revenue, Segment Expenses, Segment Assets and Segment Liabilities have been
identified to segments on reasonable basis of their relationship to the operating activities of
the segment from the internal reporting system.

(iii) Gains/losses from transactions in commodity futures, which are ultimately settled net,
with/without taking delivery, are recorded as ‘Other revenues’under the Sugar segment.

(iv) Revenue, Expenses, Assets and Liabilities, which relate to the enterprise as a whole and are
not allocable to segments on a reasonable basis, has been included under “Unallocated”.

(w) RESEARCH AND DEVELOPMENT

Research Costs are expensed as incurred. Expenditure on Research is considered as cost for
valuation of inventory and expenditure related to capital asset is grouped with property plant and
equipment under appropriate head and depreciation is provided at the applicable rate. The
Company will recognize development expenditure as intangible assets when the company can
demonstrate:

• The technical feasibility of completing the intangible asset so that the asset will be available
for use or sale

• Its intention to complete and its ability and intention to use or sell the asset

• Howthe asset will generate future economic benefits

• The availability of resources to complete the asset

• The ability to measure reliably the expenditure during development

Following initial recognition of the development expenditure as an asset, the asset is carried at
cost lessany accumulated amortisation and accumulated impairment losses. Amortisation of the
asset begins when development is complete and the asset is available for use. It is amortised on a
straight line basis over the period of expected future benefit from the related project, i.e., the
estimated useful life. Amortisation is recognised in the statement of profit and loss. During the
period of development, the asset is tested for impairment annually.

x) SUBSIDIES RECEIVED

Subsidies received towards specific fixed assets are reduced from gross book value of the
concerned fixed assets. Subsidies received relating to revenue expenditure is deducted from
related expense.

(y) MERGER OF ACCOUNTS

Ugar The aters Private Limited a wholly owned subsidiary of the Ugar Sugar Works Ltd., is merged
as per the scheme approved by National Company Law Tribunal (NCLT) Mumbai vide its order
dated October,20 2023 and was filed with Registrar of Companies (“RoC”) in accordance with the
relevant sections of the Companies Act 2013 and rules there under.

Pursuant to this order consolidated financial need not be prepared. Previous year figures include
figures of the merged entity

The merger has been accounted under ''pooling of interest'' method as prescribed in Appendix C of
Ind AS 103 "Business Combination". Outstanding balances between Ugar Theatres and Ugar
Sugar Works Limited were eliminated. All assets and liabilities have been recognised at carrying
amounts except for adjustments to bring uniformity of accounting policies as required under Ind
AS 103.

3. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Company’s accounting policies, which are described in Note No. C-2, the
Management of the Company are required to make judgements, estimates and assumptions about
the carrying amounts of assets and Labilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors that

are considered to be relevant. Actual results may differ from these estimates. The estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognized in the period in which the estimate is revised if the revision affects only that period or
in the period of the revision and future periods if the revision affects both current and future
periods.

Critical judgements in applying accounting policies :

The following are the critical judgements, apart from those involving estimations, that the
Management has made in the process of applying the Company’s accounting policies and that
have the most significant effect on the amounts recognized in the financial statements.

Key sources of estimation uncertainty:

The following are the key assumptions concerning the future, and other key sources of estimation
uncertainty at the end of the reporting period that may have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the next financial
year.

Impairment of property, plant and equipment

Determining whether property, plant and equipment are impaired requires an estimation of the
value in use of the cash-generating unit. The value in use calculation requires the management to
estimate the future cash flows expected to arise from the cash-generating unit and a suitable
discount rate in order to calculate present value. When the actual future cash flows are less than
expected, a material impairment loss may arise.

Useful lives of property, plant and equipment

The Company reviews the estimated useful lives of property, plant and equipment at the end of
each reporting period. During the current year, the management has determined that no changes
are required to the useful lives of assets.

---

Mar 31, 2024

12 The amount due to Micro and Small Enterprises as defined in "The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been Identified on the basis of information available with the Company. The disclosures relating to Micro and Small enterprises as at 31-03-2024:

13. There are no loans and advances in the nature of loans to firms / companies in which Directors of the Company are interested.

14. FINANCIAL INSTRUMENTS 14.1 Capital Management:

The Company’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, Company may issue new shares or sell assets to reduce debt. The capital structure of Company consists of debt and total equity of the Company.

The Company determines the amount of capital required on the basis of annual operating plans and long-term product and other strategic investment plans. The funding requirements are met through equity and borrowings. Company’s policy is aimed at combination of short-term and long-term borrowings. The Company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

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

The fair value of Trade Payables, Trade Receivables, Cash and Cash Equivalents, Other Bank Balances, Accrued interest and short term borrowings are reasonable approximation of fair value due to the short-term maturities of these instruments.

14.3 Fair Value Measurement

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the Ind AS 113 - Fair Value Measurement.

14.4 Financial Risk management framework

The Company is exposed primarily to market risk, credit risk and liquidity risk which may adversely impact the fair value of its financial instruments. Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of Company.

Market Risk:

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices.

Inventory Price Risk

The Company is exposed to the movement in price of principle finished product i.e. Sugar. Price of sugarcane is fixed by government. Generally, sugar production is carried out during sugarcane harvesting period from November to March. Sugar is sold throughout the year which exposes the sugar inventory to the movement in price. Company monitors the sugar price on daily basis and formulates the sales strategy to achieve maximum realisation.

Interest Rate Risk

Fluctuation in fair value or future cash flows of a financial instrument because of changes in market interest rate gives rise to interest rate risk. Almost all borrowings of Company have fixed interest rate and therefore the risk of interest rate change is not material to Company.

Credit Risk:

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms or obligations. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled analysing credit limits and creditworthiness of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. Outstanding customer receivables are regularly monitored. Company maintains its cash and cash equivalents and deposits with banks having good reputation and high quality credit ratings.

In addition, the Company is exposed to credit risk in relation to deposits related to lease premises. These deposits are not past due or impaired.

Liquidity Risk:

Liquidity risk refers to the risk that Company cannot meet its financial obligations. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. Company manages liquidity risk by maintaining adequate reserves, banking facilities by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Maturity of financial assets and liabilities:

The following tables analyses the Companys’ financial liabilities with agreed repayment periods and companies expected maturity for its financial assets. In case of financial liabilities, the amount disclosed in the tables below are contractual undiscounted cash flows based on the earliest date on which Company can be required to pay and in case of financial assets, the table has been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets

16. The Company formed CSR committee as constituted pursuant to Companies Act 2013. During the year under review the Company has spent of Rs 151.27 Lakhs.

17. Details of Benami Property held :

The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property.

18. Details of Loans and advances :

Loans and advances granted to promoters, directors, key managerial personnel (KMPs) and the related parties which are repayable on demand or without specifying any terms or period of repayment.

19. Wilful Defaulter:

The Company has not been declared as a wilful Defaulter by any Financial Institution or bank as at the date of Balance Sheet.

20. Relationship with Struck off Companies :

The Company do not have any transactions with companies struck off.

21. Registration of charges or satisfaction with Registrar of Companies (ROC)

The Company have complied Registration of charges or Satisfaction with Registrar of Companies (ROC).

22. Compliance with number of layers of companies

The Company has complied with the provision of the number of layers prescribed under clause (87) of section2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.

23. Compliance with approved Scheme(s) of Arrangements

There are no Schemes of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013.

24. Discrepancy in utilization of borrowings

The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken at the balance sheet date. There are no discrepancy in utilisation of borrowings.

25. Utilisation of Borrowed funds and share premium:

(A) The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries).

(B) the Company has not received any fund from any person(s) or entity (ies), including foreign entities (Funding Party).

The Company has not advanced or loaned or invested funds to any other person(s) or entity (ies), including foreign entities (intermediaries) with the understanding that the intermediary shall:

a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries); or

b) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries;

The Company has not received any fund from any person(s) or entity (ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or;

b) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Additional Information

26. Undisclosed income

The Company has no transaction that is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

2 7. Details of Crypto Currency or Virtual Currency:

The Company has not traded or invested in Crypto currency or Virtual Currency.

28. The Board has approved the scheme of merger between The Ugar Sugar Works Limited and Ugar Theaters Pvt. Ltd. The Company has fried a merger petition at Mumbai Bech. of NCLT. The final order is received from the NCLT.

29. The Board has recommended dividend@ 25% (Rs.0.25 per share) subject to approval of Shareholder at Annual General Meeting.

29. Figures of the previous year have been regrouped / rearranged / recast where necessary.

---

Mar 31, 2018

1. CORPORATE INFORMATION

Incorporated on 11-09-1939, The Ugar Sugar Works Ltd. (CIN-L15421PN1939PLC006738) is one of the leading sugar factories in Karnataka. Its shares are listed on BSE and NSE. The Company is engaged in manufacture and sale of sugar, industrial and potable alcohol, and generation and distribution of electricity. The Company’s plants are located at Ugarkhurd in Belagavi District and at Malli-Nagarhalli Village in Kalburgi District in the state of Karnataka.

2. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Company’s accounting policies, which are described in Note No. C-2, the Management of the Company are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

Critical judgements in applying accounting policies

The following are the critical judgements, apart from those involving estimations, that the Management has made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognized in the financial statements.

Key sources of estimation uncertainty

The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Impairment of property, plant and equipment

Determining whether property, plant and equipment are impaired requires an estimation of the value in use of the cash-generating unit. The value in use calculation requires the management to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. When the actual future cash flows are less than expected, a material impairment loss may arise.

Useful lives of property, plant and equipment

The Company reviews the estimated useful lives of property, plant and equipment at the end of each reporting period. During the current year, the management has determined that no changes are required to the useful lives of assets.

3. FIRST TIME ADOPTION OF IND AS - MANDATORY EXCEPTIONS AND OPTIONAL EXEMPTIONS

The Company has prepared the opening balance sheet as per Ind AS as of April 1, 2016 (the transition date) by recognizing all assets and liabilities whose recognition is required by Ind AS, not recognizing items of assets and liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognized assets and liabilities. However, this principle is subject to certain exceptions and certain optional exemptions availed by the company as detailed below:

Classification of debt instruments

The Company has determined that classification of debt instruments in terms of whether they meet the amortized cost criteria or the fair value through profit or loss criteria based on facts and circumstances that existed as of the transition date.

Deemed cost for property, plant and equipment and intangible assets

The Company has applied the impairment requirements of Ind AS 109 retrospectively; however, as permitted by Ind AS 101, it has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognized in order to compare it with the credit risk at the transition date. Further, the Company has not undertaken an exhaustive search for information when determining, at the date of transition to Ind ASs, whether there has been significant increase in credit risk since the initial recognition, as permitted by Ind AS 101.

Leases

Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make an assessment on basis of facts and circumstances existing at the date of transition to Ind AS, except where impact is expected not to be material. The company has elected to apply this exemption for such contracts under Para D9A of Ind AS 101.

4 The amount due to Micro and Small Enterprises as defined in "The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been identified on the basis of information available with the Company. The disclosures relating to Micro and Small enterprises as at 31-03-2018:

5. FINANCIAL INSTRUMENTS

5.1 Capital Management:

The Company’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders and maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may issue new shares or sell assets to reduce debt. The capital structure of the Company consists of debt and total equity of the Company.

The Company determines the amount of capital required on the basis of annual operating plans and long-term product and other strategic investment plans. The funding requirements are met through equity and borrowings. The Company’s policy is aimed at combination of short-term and long-term borrowings. The Company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

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

The fair value of Trade Payables, Trade Receivables, Cash and Cash Equivalents, Other Bank Balances, Accrued interest and short term borrowings are reasonable approximation of fair value due to the short-term maturities of these instruments.

5.2 Fair Value Measurement

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the Ind AS 113 - Fair Value Measurement. An explanation of each level is as follows:

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

Level 2 - Inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 - Unobservable inputs for the asset or liability.

The following table presents fair value hierarchy of assets and liabilities measured at fair value on a recurring basis as of March 31, 2018, March 31, 2017 and April 1, 2016:

Valuation Technique -Level 1:

Fair value of Mutual Funds is computed using NAV as on 31.03.2018 as per Mutual Fund Statement.

Level 2:

Fair Value of preference shares of Synergy Green Industries Ltd is computed using discounted cash flows Fair Value of equity shares of Ugar Theatres Pvt Ltd is computed using net asset method.

Level 3:

Where fair valuation was not possible on account of unobservable inputs for the assets, carrying cost is considered as fair value.

5.3 Financial Risk management framework

The Company is exposed primarily to market risk, credit risk and liquidity risk which may adversely impact the fair value of its financial instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial performance of the Company.

Market Risk:

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices.

Inventory Price Risk

The Company is exposed to the movement in price of principle finished product i.e. Sugar. Price of sugarcane is fixed by government. Generally, sugar production is carried out during sugarcane harvesting period from November to March. Sugar is sold throughout the year which exposes the sugar inventory to the movement in price. Company monitors the sugar price on daily basis and formulates the sales strategy to achieve maximum realisation.

Interest Rate Risk

Fluctuation in fair value or future cash flows of a financial instrument because of changes in market interest rate gives rise to interest rate risk. Almost all borrowings of the Company have fixed interest rate and therefore the risk of interest rate change is not material to the Company.

Credit Risk:

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual terms or obligations. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit risk is controlled analysing credit limits and creditworthiness of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. Outstanding customer receivables are regularly monitored. The Company maintains its cash and cash equivalents and deposits with banks having good reputation and high quality credit ratings.

In addition, the Company is exposed to credit risk in relation to deposits related to lease premises. These deposits are not past due or impaired.

Liquidity Risk:

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Maturity of financial assets and liabilities:

The following tables analyses the Company’s financial liabilities with agreed repayment periods and companies expected maturity for its financial assets. In case of financial liabilities, the amount disclosed in the tables below are contractual undiscounted cash flows based on the earliest date on which the Company can be required to pay and in case of financial assets, the table has been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets:

5.4 The company formed CSR committee as constituted pursuant to Companies Act 2013. During the year under review, the Company has spent Rs.22.50 Lakh (March 31, 2017 - Rs.15.00 Lakh). The Company spent the CSR amount towards community development in line with its CSR policy.

5.5 First time Ind AS adoption reconciliations:

a. Effect of Ind AS Adoption on balance sheet as at 31 -03- 2017 and 01 -04-2016:

* Previous GAAP figures have been reclassified to conform to Ind AS presentation requirements for the purpose of this note.

6. Figures of the previous year have been regrouped / rearranged / recast where necessary.

7. Figures in the brackets pertain to previous year.

---

Mar 31, 2016

a. Short term Employee Benefits

All employee benefits payable wholly within twelve months of rendering the services are classified as short term employee benefits. Benefits such as salaries, wages, bonus and short term compensated absences, leave travel allowance, etc. are recognized in the period in which the employee renders the related service.

b. Post Employment Benefits:

i. Defined Contribution Plans

The Company''s superannuation scheme and pension scheme are defined contribution plans. The contribution paid / payable under the scheme is recognized during the period in which the employee renders related service.

The employees'' gratuity fund scheme and provident fund scheme managed by a Trust are the Company''s defined benefit plans. The present value of the obligation under such defined benefit plans is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined plans, is based on the market yields on Government Securities as at the balance sheet date, having maturity periods approximating to the terms of related obligations.

Actuarial gains and losses are recognized immediately in the Statement of Profit & Loss.

in case of funded plans, the fair value of the plan''s assets is reduced from the gross obligation under the defined benefit plans, to recognize the obligation on the net basis

Gains or losses on curtailment or settlement of any defined benefit plan are recognized when the curtailment or settlement occurs. Past service cost is recognized as expenses on a straight line basis over the average period until the benefits become vested.

The Company pays contribution to a recognized provident fund trust in respect of all locations. The guidance note on implementing AS-15, Employees Benefits (Revised 2006) as issued by the Institute of Chartered Accountants of India (ICAI) states that provident funds set up by employer, which requires interest shortfall to be met by the employer, needs to be treated as a defined benefit plan. In the absence of clear guidelines on the issue of actuarial valuation related to interest shortfall to be made good by the employer, the Company''s actuary have expressed their inability to reliably measure the provident fund liability of the Company''s recognized provident fund. Accordingly, the Company is unable to exhibit the related disclosures.

c. Long Term Employee Benefit

The obligation for long term employee benefits such as long term compensated absences is recognized in the same manner as in the case of defined benefit plans as mentioned in note (b)(ii) above.

Accumulated leaves that are expected to be utilized within the next twelve months are treated as short term employee benefits.

viii. Revenue Recognition

a. Revenue in respect of insurance / other claims, interest, subsidy, Incentive, etc. is recognized only when it is reasonably certain that the ultimate collection will be made.

b. Sales Value is inclusive of Excise Duty and net of sales tax, where applicable.

ix. Foreign Currency Transactions

a. All foreign currency transactions are accounted for at the rates prevailing on the date of the transaction. The exchange differences on settlement / conversion are adjusted to Profit & Loss Account.

b. In respect of amount payable in foreign currency covered by forward contracts, the premium is recognized over the period of contract.

x. Subsidies Received

a. Subsidies received towards specific fixed assets are reduced from gross book value of the concerned fixed assets.

b. Subsidies received relating to revenue expenditure are deducted from related expense.

xi. Borrowing Costs

a. Borrowing costs that are attributable to acquisition, construction or erection of qualifying assets incurred during the period of acquisition or construction, are capitalized as part of the cost of the asset.

b. Other borrowing costs are recognized as expenditure in the period in which they are incurred.

xii. Taxation

Tax on income for the current period is made in accordance with the provisions of the Income Tax Act, 1961. Deferred Tax is recognized on timing differences between the accounting income and the taxable income for the period. The tax effect is calculated on the accumulated timing differences at the end of the accounting period based on the prevailing enacted regulations or those that may be substantively enacted by the Balance Sheet date.

xiii. Earnings per share

a. Basic Earnings per share

For the purpose of calculating basic earnings per share, the net profit or loss for the period attributable to equity shareholders after deducting any attributable tax thereto for the period is divided by weighted number of equity shares outstanding during the period.

b. Diluted Earnings per share

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1 Figures of the previous year have been regrouped / rearranged / recast where necessary.

2 Figures in the brackets pertain to previous year.

---

Mar 31, 2015

1 Terms / Rights attached to Equity Shares

i. The Company has only one class of equity shares of face value of Re. 1. Each holder of equity share is entitled to one vote per share. Dividend recommended by the Board is subject to approval of the shareholders in the ensuing General Meeting.

ii. 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 the proportion of number of equity shares held by the shareholders.

iii. The Directors have not recommended any dividend for FY 2014-15.[Dividend Recommended for FY 2013-14 - Nil]

2. There has been no continuing default as on the balance sheet date in repayment of any of the above borrowings and interest thereon.

3. Corporate Information

Incorporated on 11-09-1939, The Ugar Sugar Works Ltd. (CIN-L15421PN193/PLC006738) is one of the leading sugar factories in Karnataka. Its shares are listed on BSE and NSE. The Company is engaged in manufacture and sale of sugar, industrial and potable alcohol, and generation and distribution of electricity. The Company's plants are located at Ugarkhurd in Belgaum District and at Malli-Nagarhalli Village in Kalburgi District in the state of Karnataka.

4. Basis of Preparation

a. The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The financial statements have been prepared to comply in all material respects with The Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 2013

b. The financial statements have been prepared under historical cost convention on an accrual basis.

c. The accounting policies applied with the Company are consistent with those used in the previous year.

d. The financial statements have been prepared on a going concern basis.

5. II The Company does not have any Secondary Reportable Segments.

III. Significant Accounting Policies relating to Segment Reporting

a. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

b. Inter-segment transfers are recorded at cost except for own generated Bagasse and Molasses, cost of which is unascertainable and which are recorded at Net Realisable Value.

c. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

6. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosure as per revised AS-15 are produced below:

Gratuity

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan provides for, at retirement or termination of employment, an amount based on the respective employee's last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trust's Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left during the current period.

Defined Contribution Plan:

7. The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The above information is certified by the actuary.

8. Disclosure of Related Parties and Related Party Transactions

I. Name of the Related Party over which Nature of Relationship significant influence exists

i. Ugar Theatres Pvt.Ltd., Associate Company

ii. Ugar Quality Packaging Pvt. Ltd., Associate Company

iii. Ugar Consultancy Ltd Associate Company (under liquidation) II. Names of the Related Parties with whom transactions were carried out during the year and description of relationship

A. Key Management Personnel (KMP) Designation

I. Shri Prafulla Vinayak Shirgaokar Executive Vice Chairman (Exc. VC)

ii. Shri Shishir Suresh Shirgaokar Managing Director (MD)

iii. Shri Niraj Shishir Shirgaokar Joint Managing Director (Jt. MD)

iv. Shri Chandan Sanjeev Shirgaokar Joint Managing Director (Jt. MD)

B. Relatives of Key Management Personnel

Names of the transacting parties Nature of Relationship

i . Shri. Rajendra Vinayak Shirgaokar Chairman & Mentor (C&M) & Brother of Exc. VC and father of Director Shri Sachin Shirgaokar

ii. Sou. Smita Prafulla Shirgaokar Wife of Exc. VC

iii. Sou. Vinita Mahesh Samant Daughter of Exc.VC

iv. Sou. Shilpa Naval Kumar Daughter of Exc.VC

v. Sou. Sindhu Vijay Dalvi Sister of C&M & Exc.VC

vi. Sou. Savita Shishir Shirgaokar Wife of MD

vii. Sou. Asawari Niraj Shirgaokar Wife of Jt. MD -Shri. Niraj Shishir Shirgaokar

viii. Shri. Arjun Niraj Shirgaokar Son of Jt. MD -Shri. Niraj Shishir Shirgaokar

ix. Kum. Anjini Niraj Shirgaokar Daughter of Jt. MD -Shri. Niraj Shishir Shirgaokar

x. Sou. Puja Hrishikesh Pusalkar Daughter of MD

xi. Sou. Rekha Rajnikant Khedekar Sister of MD

xii. Sou. Chitra Arun Dalvi Sister of MD

xiii. Smt. Radhika Sanjeev Shirgaokar Mother of Jt.MD-Shri. Chandan Shirgaokar and

Director Shri Sohan Shirgaokar

xiv. Sou. Geetali Chandan Shirgaokar Wife of Jt.MD-Shri. Chandan Sanjeev Shirgaokar

xv. Shri. Sachin Rajendra Shirgaokar Director and son of C&M

xvi. Shri. Sohan Sanjeev Shirgaokar Director and Brother of Jt.MD-Shri. Chandan Sanjeev Shirgaokar

9. Disclosure of Related Parties and Related Party Transactions

C. Enterprises over which KMP or Relatives of KMP are able to exercise significant influence

Name of the transacting related party Nature of Relationship

i . S. B. Reshellers Pvt. Ltd. C&M, Exc.VC,MD, Jt.MDs & Directors Shri. Sachin & Sohan Shirgaokar are Directors

ii. Shantaram Machineries Pvt. Ltd. Exc.VC, MD & Directors Shri. Sachin & Sohan Shirgaokar are Directors

iii. Sangli Fabricators Pvt Ltd MD, Jt.MD- Shri Chandan Shirgaokar & Director Sachin Shirgaokar are Directors

iv. Tara Tiles Pvt Ltd. Exc.VC, MD & Director Shri Sachin Shirgaokar are Directors



v. Ugar Pipe Industries Pvt. Ltd. Exc.VC,MD & Jt.MD- Shri Chandan Shirgaokar are Directors

vi. Vinayak Shirgaokar Investments Pvt.Exc.VC, Jt.MD- ShriChandan Ltd. Shirgaokar & Director Shri Sachin Shirgaokar are Directors

vii. D.M. Shirgaokar Investments Pvt. Exc.VC, MD & Directors Shri. Ltd. Sachin & Shri Sohan Shirgaokar are Directors

viii. Prafulla Shirgaokar Investments Exc.VC, Wife of Exc.VC & Director Pvt. Ltd. Shri Sohan Shirgaokar are Directors

ix. Mohan Shirgaokar Investments C&M, Exc.VC, MD, Wife of MD & Pvt. Ltd. Wife of Jt.MD- Shri Niraj Shirgaokar are Directors

x. Shishir Shirgaokar Investments MD, Wife of MD, MD's son's wife Pvt. Ltd. and Director Shri Sachin Shirgaokar are Directors

xi. Prabhakar Shirgaokar Investments Exc.VC & MD are Directors Pvt. Ltd.

xii. Suresh Shirgaokar Investments C&M, MD & Jt.MD Shri Chandan Pvt. Ltd. Shirgaokar and Director Shri Sachin Shirgaokar are Directors

xiii. Sanjeev Shirgaokar Investments Jt.MD Shri Chandan Shirgaokar, Pvt. Ltd. his Mother and Directors Shri. Sachin Shirgaokar and Shri Sohan Shirgaokar are Directors

xiv. Synergy Green Industries Pvt. C&M, Exc.VC, Jt.MDs and Directors Ltd. Shri. Sachin Shirgaokar and Shri Sohan Shirgaokar are Directors

10. The amount due to Micro and Small Enterprises as defined in "The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been identified on the basis of information available with the Company. The disclosures relating to Micro and Small enterprises as at 31-03-2015:

11. Figures of the previous year have been regrouped / rearranged / recast where necessary.

12. Figures in the brackets pertain to previous year.

Notes:

13. Bonus shares of the value of Rs. 7.47 lakh, Rs. 10.65 lakh, Rs. 16.82 lakh, Rs. 50.00 lakh, Rs. 75.00 lakh and Rs. 337.50 lakh were issued as fully paid bonus shares, respectively in the years 1950-51, 1966-67, 1973-74, 199495, 1997-98 and 2004-05, by capitalization of reserves.

14. The Accounting year those ended on 30-09-1995 comprised of 18 months and those ended on 31-03-2007 comprised of 6 months only.

15. Dividend for the year ended 30-09-1995 includes interim dividend.

16. Total Income includes value of sales, income from bye-products and other income, and adjustments in the value of opening and closing stocks of finished goods.

17. Figures relating to FY ended 2005-06, 2006-07 includes figures of Tasgaon and Phaltan and 2008-09, 2009-10, 2010-11,2011-12,2012-13, 2013-14 and 2014-15 includes figures of Jewargi unit.

---

Mar 31, 2014

1: CORPORATE INFORMATION

Incorporated on 11-09-1939, The Ugar Sugar Works Ltd. is one of the leading sugar factories in Karnataka. Its shares are listed on BSE and NSE. The Company is engaged in manufacture and sale of sugar, industrial and potable alcohol, and generation and distribution of electricity. The Company''s plants are located at Ugarkhurd in Belgaum District and at Malli-Nagarhalli Village in Gulbarga District in the state of Karnataka.

2: BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

3. Principal terms, security and repayment schedule of long term secured loans

i. Loan from Bank of Baroda is obtained for setting up sugar factory with cogeneration of power at Jewargi. The rate of interest is presently Base Rate (BR) 2.5%, i.e. 12.75% p. a. The loan is secured by hypothecation of Plant & Machinery and Stores & Spares at the Jewargi Plant. The loan is repayable in quarterly instalments of Rs. 232.00 lakh. The last instalment is due on 18-07-2014.

ii. Loan from Central Bank of India is obtained for setting up sugar factory with cogeneration of power at Jewargi. The rate of interest is presently BR 2.25% i.e. 12.5% p. a. The loan is secured by hypothecation of Plant & Machinery and Stores & Spares at the Jewargi Plant. The loan is repayable in monthly instalments of Rs. 33.00 lakh. The last instalment is due on 01-03-2015.

iii. Loan from Central Bank of India is obtained for installation of sugar machinery. The rate of interest is presently BR 2.25% i.e. 12.5% p. a. The loan is secured by hypothecation of the said Machinery. The loan is fully repaid on 02-01-2014.

iv. Loan from Central Bank of India is obtained for expansion of crushing capacity of sugar plant at Ugar. The rate of interest is presently BR 1.75% i.e. 12% p. a. The loan is secured by hypothecation of the said Machinery. The loan is repayable in quarterly instalments of Rs. 120.54 lakh. The last instalment is due on 30-09-2020.

v. Loan from Bank of India is obtained to support capital expenditure. The rate of interest presently is BR 0.75% i.e. 10.95% p.a. The loan is secured by hypothecation of proposed machinery. The loan is repayable in quarterly instalments of Rs. 75.00 lakh. The last instalment is due on 31-10-2016.

vi. Loan from Technology Development Board is obtained for Ugar unit for setting up Effluent Treatment Plant. The rate of interest is 5% p. a. The loan is secured by hypothecation of the said machinery. The loan is fully repaid on 25-05-2013.

vii. Loan from Sugar Development Fund is obtained for Jewargi unit for setting up power project. The rate of interest is 4% p. a. The loan is secured by exclusive second charge on all movable and immovable assets of the Company. The Loan is repayable in ten six monthly instalments of Rs. 121.59 lakh. The last instalment is due on 30-06-2018.

4. There has been no continuing default as on the balance sheet date in repayment of any of the above borrowings and interest thereon.

i. Cash credit hypothecation is secured by hypothecation of stock of stores & spares, stock of molasses, stock in trade and book debts. The cash credit is repayable on demand and carries rate of interest at BR 1% i.e. 11.25% p.a.

ii. Cash credit pledge is secured by pledge of stock of sugar. The cash credit is repayable on demand and carries rate of interest at BR 1% i.e. 11.20% to 11.25%.

iii. Loan from Bank of India is obtained to meet off-season expenditure. The rate of interest presently is BR 0.75% i.e. 10.95% p.a. The loan is secured by hypothecation of proposed machinery. The loan is repayable in quarterly instalments of Rs. 500.00 lakh. The last instalment is due on 31-01-2015.

iv. Fixed Deposits are unsecured and are accepted from shareholders and public for a period of one year. The rate of interest for fixed deposits is 10.5% p.a. for senior citizens and 10% p.a. for others.

5. There has been no continuing default as on the balance sheet date in repayment of any of the above borrowings and interest thereon.

6: TRADE PAYABLES

1. Creditors for Supplies 13,887.28 8,182.38

Particulars Financial Year Financial Year 2013 - 2014 2012 - 2013 Rs. Lakh Rs. Lakh NOTE C: OTHER INFORMATION

1. Contingent Liabilities not provided for

a. Claims against the --- --- Company not acknowledged as debts

b. Excise Duty / Service Tax, Liability Disputed 837.33 394.55

c. Cane Purchase Tax, Liability Disputed --- 72.84

d. Income Tax, Liability Disputed 15.74 ---

e. Corporate Guarantees given to the Bankers 5,349.02 3,577.56

7. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosure as per revised AS-15 are produced below:

Gratuity

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan provides for, at retirement or termination of employment, an amount based on the respective employee''s last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trust''s Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left during the current period.

8. The amount due to Micro and Small Enterprises as defined in "The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been identified on the basis of information available with the Company. The disclosures relating to Micro and Small enterprises as at 31stMarch, 2014.

9. Figures of the previous year have been regrouped / rearranged / recast where necessary.

10. Figures in the brackets pertain to previous year.

---

Mar 31, 2013

NOTE A - 1: CORPORATE INFORMATION

Incorporated on 11-09-1939, The Ugar Sugar Works Ltd. is one of the leading sugar factories in Karnataka. Its shares are listed on BSE and NSE. The Company is engaged in manufacture and sale of sugar, industrial and potable alcohol, and generation and distribution of electricity. The Company''s plants are located at Ugarkhurd in Belgaum District and at Malli-Nagarhalli Village in Gulbarga District in the state of Karnataka.

NOTE A - 2: BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, as amended, and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

3. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosures as per revised AS-15 are produced below:

Gratuity :

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan provides for, at retirement or termination of employment, an amount based on the respective employee''s last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trust''s Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left during the current period.

4. Based on available information, presently, there are no amounts payable to parties mentioned in the Micro, Small and Medium Enterpri ses Development Act, 2006.

5. Disclosure required as per clause 3 2 of the Listing Agreement:

6. Figures of the previous year have been regrouped / rearranged / recast where necessary.

7. Figures in the brackets pertain to previo us year.

---

Mar 31, 2012

NOTE A - 1: CORPORATE INFORMATION

Incorporated on 11-09-1939, The Ugar Sugar Works Ltd. is one of the leading sugar factories in Karnataka. Its shares are listed on BSE and NSE. The Company is engaged in manufacture and sale of sugar, industrial and potable alcohol, and generation and distribution of electricity. The Company’s plants are located at Ugarkhurd in Belgaum District and at Malli-Nagarhalli Village in Gulbarga District in the state of Karnataka.

NOTE A - 2: BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accouting Standards) Rules, 2006, as amended, and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the conventional cost convention.

1. Terms / Rights attached to Equity Shares

The Company has only one class of equity shares of face value of Re. 1 each, holder of equity share is entitled to one vote per share. Dividend recommended by the Board is subject to approval of the shareholders in the ensuing General Meeting.

For the year 2011-12, the Directors have recommended dividend @ 25% (i.e. Re. 0.25 per equity share of Re. 1) [Previous Year - Nil].The amount of dividend including corporate dividend tax works out to Rs. 326.88 lakh [PreviousYear - Nil].

In the event of liquidation of the Company, the holdersof equityshareswill be entitled to receive remaining assetsof the Company, after distribution of all preferential amounts. The distribution willbe in the proportion of number of equity shares held by the shareholders.

2. Principal terms, security and repayment schedule of long term secured loans

i. Loan from IDBI Bank is availed for working capital, free of interest. The loan is secured by residual charge on fixed assets of the Company. The loan is obtained in the FY2009-10.,The loan isfully repaid on 14-03-2012.

ii. Loan from Bank of Baroda is obtained for setting up sugar factory with cogeneration of power at Jewargi. The rate of interest is presently Base Rate (BR) 25%, i.e. 13.25% p. a. The loan is secured by hypothecation of Plant & Machinery and Stores & Spares at the Jewargi Plant. The loan is repayable in quarterly instalments ofRs. 232.00 lakh, lastinstalmentbei ng due on 05-01-2015.

iii. Loan from Central Bank of India is obtained for setting up sugar factory with cogeneration of power at Jewargi. The rate of interest is presently BR 2.25% i.e. 13% p. a. The loan is secured by hypothecation of Plant & Machinery and Stores & Spares at the Jewargi Plant. The loan is repayable in monthly instalments of Rs. 33.00 lakh, last instalment being due on 01-05-2015.

iv. Loan from Central Bank of India is obtained for installation ofsugar machinery. The rate of interest is presently BR 2.25% i.e. 13% p.a.The loan is secured by hypothecation of the said Machinery. The loan is repayable in monthly instalmentsof Rs. 22.00 lakh, last instalment being due on 01-12-2014.

v. Loan from Sugar Development Fund is obtained for Ugar unit for Modernisation-cum-Expansion. The rate of interest is 4% p. a.The loan is secured by exclusive second charge on al l movable assets of the Company. The Loan is repayable in five yearly instalments of Rs. 114.18 lakh; lastinstalmentbei ng due on 02-01-2013.

vi. Loan from Sugar Development Fund is obtained for Jewargi unit for setting power project. The rate of interest is 4% p. a.The loan is secured by exclusive second charge on all movable and immovable assets ofthe Company. The Loan is repayable in ten six monthly instalments of Rs. 121.59 lakh commencing from 31-12-2013; lastinstalmentbeing due on 30-06-2018.

vii. Deferment of Cane Purchase Tax is granted by Government of Karnataka to encourage additional cane crushing. The Deferment is free of interest and fully repayable in June 2012.

3. There has been no continuing default ason the balance sheet date in repaymentof any of the above borrowings & interestthereon.

3. i. Cash credit hypothecation is secured by hypothecation of stock of stores & spares, stock of molasses, stock in trade and book debts. The cash credit is repayable on demand and carries rate ofinterest at 12% p.a.

ii. Cash credit pledge is secured by pledge of stock of sugar. The cash creditis repayable on demand and carries rate of interest at BR 1% to 2%, i.e. 11.65%to 12.75% p.a.

iii. Fixed Deposits are unsecured and are accepted from shareholders and public for a period of one year. The rate of interest for fixed deposits is 10% p.a. for senior citizens and 9.5%p.a.for others.

4. There has been no continuing default as on the balance sheet date in repayment of any of the above borrowings & interest thereon.

Financial Financial Particulars Year 2011-12 Year 2010-11 Rs. Lakh Rs. Lakh

NOTE C: OTHER INFORMATION

1. Contingent Liabilities not provided for

a. Claims against the Company not acknowledged as debts - 41.00

b. Excise Duty / Service Tax, Liability Disputed 207.22 179.92

c. Cane Purchase Tax, Liability Disputed 72.84 72.84

d. Corporate Guarantees givento the Bankers 426.24 726.14

2. Commitments

Estimated amounts of contracts remaining to be executed on capital account 94.24 14.17

3. Trade Receivables in Note 18 include amount due from a private limited company in which directors ofthe Company are directors - 0.14

II. The Company does not have any Secondary Business Segments.

III. Significant Accounting Policies relating to Segment Reporting

a. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

b. Inter-segment transfers are recorded at cost except for own generated Bagasse and Molasses, cost of which is unascertainable and which are recorded at prevalent purchase price.

c. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

NOTE C: OTHER INFORMATION

3. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosure as per revised AS-15 are produced below:

Gratuity

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan provides for, at retirement or termination of employment, an amount based on the respective employee's last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trust's Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left duringthe current period.

4. Based on available information, presently, there are no amounts payable to parties mentioned in the Micro, Small and Medium Enterprises Development Act, 2006.

5. Figures of the previous year have been regrouped / rearranged / recast where necessary.

6. Figures in the brackets pertain to previous year.

Notes:

1. Bonus shares of the value of Rs. 7.47 lakh, Rs. 10.65 lakh, Rs. 16.82 lakh, Rs. 50.00 lakh, Rs. 75.00 lakh and Rs. 337.50 lakh were issued as fully paid bonus shares, respectively in the years 1950-51, 1966-67, 1973-74, 1994-95, 1997-98 and 2004-05, by capitalization of reserves.

2. Accounting year ended 30-09-1985 comprised of 15 months and those ended on 31-03-1990, 30-09-1995 comprised of 18 months and those ended on 31-03-2007 comprised of 6 months only.

3. Dividend for the year ended 30-09-1995 includes interim dividend.

4. Total Income includes value of sales, income from bye-products and other income, and adjustments in the value of opening and closing stocks of finished goods.

5. Figures relating to FY ended 2005-06 , 2006-07 includes figures of Tasgaon and Phaltan and 2008-09, 2009-10, 2010-11 and 2011-12 includes figures of Jewargi unit.

---

Mar 31, 2011

31-03-2011 31-03-2010

Rs. Lakh Rs. Lakh

1. Contingent Liabilities not provided for Claims against the Company not

acknowledged as debts 41.00 41.00

Excise Duty, liability disputed 179.86 168.31

Cane Purchase Tax, Liability Disputed 72.84 72.84

Corporate Guarantees given to Bankers 3,761.00 3,618.00

II. The Company does not have any Secondary Business Segments

Significant Accounting Policies relating to Segment Reporting

1. Business Segments are determined on the basis of the goods manufactured and in accordance with Account- ing Standard 17.

2. Inter-segment transfers are recorded at cost except for own generated Bagasse and Molasses, cost of which is unascertainable and which are recorded at prevalent purchase price.

3. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

2. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosure as per revised AS-15 are produced below:

Gratuity

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan prov ides for, at retirement or termination of employment, an amount based on the respective employee's last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trust's Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left during the current period.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relev ant factors, such as supply and demand in the employment market. The above information is certified by the actuary.

3. Disclosure of Related Parties and Related Party Transactions

I Name of the Related Party over which control exists Nature of Relationship

i. Ugar Consultancy Ltd. - Associate Company

ii. Ugar Theatres Pvt. Ltd. - Associate Company

iii. Ugar Quality Packaging Pvt. Ltd. - Associate Company

II. Names of the Related Parties with whom transactions were carried out during the year and description of relationship

1. Key Management Personnel (KMP) Designation

i. Shri Prafulla Vinayak Shirgaokar - Managing Director (MD)

ii. Shri Shishir Suresh Shirgaokar - Executive Director (ED)

2. Relatives of Key Management Personnel

Name of the transacting related party Nature of Relationship

i. Shri Rajendra Vinayak Shirgaokar - Chairman & Mentor

(C&M) and Brother of MD

ii. Sau. Smita Prafulla Shirgaokar - Wife of MD

iii. Sau. Vinita Mahesh Samant - Daughter of MD

iv. Sau. Shilpa Naval Kumar - Daughter of MD

v. Sau. Savita Shishir Shirgaokar - Wife of ED

vi. Shri Niraj Shishir Shirgaokar - Son of ED

vii. Sau. Puja Hrishikesh Pusalkar - Daughter of ED

viii. Sau. Sindhu Vijay Dalvi - Sister of C&M and MD

ix. Sau. Rekha Rajanikant Khedekar - Sister of ED

x. Sau. Chitra Arun Dalvi - Sister of ED

4. Enterprises over which KMP or Relatives of KMP are able to exercise significant influence

Name of the transacting related party Nature of Relationship

i. S. B. Reshellers Pvt. Ltd. - MD is a director

ii. Shantaram Machineries Pvt. Ltd. - MD and ED are directors

iii. Sangli Fabricators Pvt. Ltd. - ED is a director

iv. Tara Tiles Pvt. Ltd. - MD and ED are directors

v. Ugar Pipe Industries Pvt. Ltd. - MD and ED are directors

vi. Vinayak Shirgaokar Investments Pvt. Ltd. - MD is a director

vii. D. M. Shirgaokar Investments Pvt. Ltd. - MD and ED are directors

viii. Prafulla Shirgaokar Investments Pvt. Ltd. - MD and Wife of MD are directors

ix. Mohan Shirgaokar Investments Pvt. Ltd. - MD and ED are directors

x. Shishir Shirgaokar Investments Pvt. Ltd. - ED, Wife of ED and ED's Son's

Wife are directors

xi. Prabhakar Shirgaokar Investments Pvt. Ltd. - MD and ED are directors

xii. M/s Shirgaokar Brothers - MD, ED and Son of ED are partners

5. Based on available information, presently, there are no amounts payable to parties mentioned in the Micro, Small and Medium Enterprises Development Act, 2006.

6. Figures for the previous year are regrouped / recast where necessary.

7. Working for the year has been done considering the current trend in the sugar prices.

8. Figures in the brackets pertain to previous year.

---

Mar 31, 2010

1. Contingent Liabilities not provided for

Claims against the Company not

acknowledged as debts 41.00 41.00

Excise Duty, liability disputed 168.31 144.44

Cane Purchase Tax, Liability Disputed 72.84 0.00

Corporate Guarantees given to Bankers 3,618.00 4,282.00

II. The Company does not have any Secondary Business Segments

Significant Accounting Policies relating to Segment Reporting

1. Business Segments are determined on the basis of the goods manufactured and in accordance with Accounting Standard 17.

2. Inter-segment transfers are recorded at cost except for own generated Bagasse and Molasses, cost of which is unascertainable and which are recorded at prevalent purchase price.

3. Segment report is prepared in conformity with accounting policies adopted for preparing and presenting financial statements.

2. Discontinued Operations (Disclosure as per Accounting Standard - 24)

The Company has discontinued sugar manufacturing activity at leased units at Tasgaon and Phaltan from the crushing season 2007-08. The decision to discontinue the lease operations was taken on 29-09-2007. Final settlement is in progress. The foilowing statement shows the position of liabilities and assets and of revenue and expenses of continuing and discontinued operations:

3. Disclosure with respect to AS-15

The Company has implemented Revised Accounting Standard - 15 on Employee Benefits and made the provisions accordingly. The disclosure as per revised AS-15 are produced below:

Gratuity

In accordance with the applicable laws, the Company provides for gratuity, a defined retirement plan (Gratuity Plan) covering all staff, workers and officers. The Gratuity Plan provides for, at retirement or termination of employment, an amount based on the respective employees last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a Gratuity Trust which in turn mainly contributes to Life Insurance Corporation of India (LIC) for this purpose. Under this plan, the settlement obligation remains with the Gratuity Trust. LIC administers the plan and determines the contribution premium required to be paid by the Trust. The Company has also obtained an independent actuarial valuation of the Trusts Assets and Liabilities, and accordingly, the difference has been provided by the Company. The gratuity liability has been paid by the Company in case of employees, who left during the current period.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The above information is certified by the actuary.

4. Disclosure of Related Parties and Related Party Transactions

I. Name of the Related Party over which control exists Nature of Relationship

i. Ugar Consultancy Ltd. .....Associate Company

ii. Ugar Theatres Private Limited .....Associate Company

iii. Ugar Quality Packaging Pvt. Ltd. .....Associate Company

iv. Sadashiva Sugars Ltd. .....Associate Company (till October 2009)

II. Names of the Related Parties with whom transactions were carried out during the year and description of relationship

1. Key Management Personnel (KMP) Designation

i. Shri Prafulla Vinayak Shirgaokar .....Managing Director (MD)

ii. Shri Shishir Suresh Shirgaokar .....Executive Director (ED)

2. Relatives of Key Management Personnel

Name of the transacting related party Nature of Relationship

i. Shri Rajendra Vinayak Shirgaokar .....Brotherof MD

ii. Sau. Smita Prafulla Shirgaokar .....Wife of MD

iii. Sau. Vinita Mahesh Samant .....Daughter of MD

iv. Sau. Shilpa Naval Kumar .....Daughter of MD

v. Sau. Savita Shishir Shirgaokar .....Wife of ED

vi. Shri Niraj Shishir Shirgaokar .....Son of ED

vii. Sau. Puja Hrishikesh Pusalkar .....Daughter of ED

viii. Sau. Sindhu Vijay Dalvi .....Sister of MD

ix. Sau. Rekha Rajanikant Khedekar .....Sister of ED

x. Sau. Chitra Arun Dalvi .....Sister of ED

3. Enterprises over which KMP or Relatives of KMP are able to exercise significant influence

Name of the transacting related party Nature of Relationship

i. S. B. Reshellers Pvt. Ltd. .....MD is a director

ii. Shantaram Machineries Pvt. Ltd. .....MD and ED are directors

iii. Sangli Fabricators Pvt. Ltd. .....ED is a director

iv. Tara Tiles Pvt. Ltd. .....MD and ED are directors

v. Ugar Pipe Industries Pvt. Ltd. .....MD and ED are directors

vi. Vinayak Shirgaokar Investments Pvt. Ltd .....MD is a director

vii. D. M. Shirgaokar Investments Pvt. Ltd. .....MD and ED are directors

viii. Prafulla Shirgaokar Investments Pvt. Ltd .....MD and Wife of MD are directors

ix.Mohan Shirgaokar Investments Pvt. Ltd. .....MD and ED are directors

x. Shishir Shirgaokar Investments Pvt. Ltd. .....ED, Wife of ED and EDs Sons Wife are directors

xi.Prabhakar Shirgaokar Investments Pvt. Ltd. .....MD and ED are directors

xii. M/s Shirgaokar Brothers .....MD, ED and Son of ED are partners

5. Based on available information, presently, there are no amounts payable to parties mentioned in the Micro, Small and Medium Enterprises Development Act, 2006.

6. Figures for the previous year are regrouped / recast where necessary.

7. Figures in the brackets pertain to previous year.