1. Segmental Reporting
Since the Comp. is engaged solely in the Industrial Automation
segment, primary reporting disclosure for business segment, as
envisaged in AS 17 is not applicable to the Comp. & secondary
segment reporting has been confined to sales in India & exports
outside India.
2. Taxation
as] Transfer Pricing:
The Finance Act 2001 has introduced, with effect from assessment year
2002-03 [effective April 1, 2001s] detailed Transfer Pricing regulations
for computing the income from international transactions between
associated enterprises on an arms length basis. These regulations,
inter alia, also require the maintenance of prescribed documents and
information including furnishing a report from an Accountant within the
due date of filing the Return of Income.
For the tax year ended March 31, 2007 the Comp. had undertaken a
study to comply with the said transfer pricing regulations for which
the prescribed certificate of Accountant has been obtained & this
did not envisage any tax liability.
For the tax year ending March 31, 2008 the Comp. will carry out a
similar study to comply with the said regulations.
3. The Comp. initiated the process of identifying Micro, Small and
Medium Enterprises [SMEs], as defined under the Micro, Small & Medium
Enterprises Development Act, 2006, by requesting vendor confirmation to
the letters circularised by it. The Comp. has received responses from
3% approximately of vendors, of which 2 vendors have confirmed that
they are a SME.
as] The principal amount remaining unpaid as at March 31, 2008 Interest
due thereon remaining unpaid on March 31, 2008
bs] The amount of interest paid by buyer in terms of section 16 of
Micro, Small & Medium Enterprises Development Act, 2006, along with
the amount of payment made to the supplier beyond the appointed day
during each accounting year.
cs] The amount of interest due & payable for period of delay in
making payment [which have been paid but beyond the appointed day
during the years] but without adding the interest specified under the
Micro, Small & Medium Enterprises Development Act, 2006;
ds] The amount of interest accrued & remaining unpaid at the end of
each accounting year; and
es] The amount of further interest remaining due & payable even in the
succeeding years, until such date when the interest dues as above are
actually paid to the small enterprise, for purpose of disallowance
as a deductible expenditure under section 23 of Micro, Small and
Medium Enterprises Development Act, 2006.
Note: The above information & that given in Schedule K - Current
Liabilities regarding SME has been determined based on confirmations
received by Company, which has been relied upon by auditors.
4. The company, during January 2005, had entered into a Build, Own,
Operate & Transfer [BOOTs] agreement with Electricity Supply Company
to supply Real-time Remote Automatic Meter Reading System [RRAMR
Systems] for providing billing & meter tampering data. The period of
such agreement is for five years ending on December 31, 2009.
On Acc. of certain technical & logistical reasons, the Company
carrys out an impairment test on such assets periodically & assesses
recoverable amount based on the present value of future cash flows,
using a discount rate of 9%, expected to arise from the continuing use
of the assets & its eventual disposal. Carrying value of such assets
aggregating to Rs. 901.47 [2007: Rs. 1,356.88s] [net of accumulated
depreciation & accumulated impairment loss but including capital work
in progress of Rs. Nil [2007: Rs. 406.84s]] exceeds the recoverable
amount of Rs. 52.24 [2007: Rs. 985.47s] & accordingly, the difference
of Rs. 849. 23 [2007: Rs. 371.41s] has been recognised in the Profit and
Loss Account as impairment loss & disclosed as an exceptional item.
5. Physical existence of certain assets valued Rs. 1,832.70 [2007:
Rs. 1,354.54s] [Gross Blocks] has been established considering the output
generated by such assets as such assets are concealed as part of larger
equipment of third party & lying in their custody.
6. The Comp. has adopted the principles of Companies
[Accounting Standardss] Rules, 2006, which are applicable to the Company
from April 1, 2007, towards accounting for exchange differences arising
in respect of purchase of fixed assets from countries outside India.
Consequently, Rs.89.39, being the exchange difference during the year,
has not been capitalised to Fixed Assets & has been credited to
Exchange Gain Account in the Profit & Loss Account having
consequential effect on the net profit for year.
7. The Company, based on experience, has revised its estimates on
inventory provisioning policy in respect of slow moving & non moving
inventory & accordingly, an amount of Rs. 241.68 has been provided in
these account. However, the effect of change in basis on the
current years profit is not readily ascertainable.
8. This Comp. has entered into forward exchange contracts for
hedging the foreign exchange fluctuation risk on receivable and
payable, which has been accounted for in line with AS 11 'The Effects
of Changes in Foreign Exchange Rates'. Accordingly, the foreign
currency receivable Rs. 45.80 [2007: Rs. Nils] [net of payable Rs.
1,390.40 [2007: Rs. Nils]], in subsequent year, relating to forward
exchange contracts for hedging has been disclosed under Advances
Recoverable in cash or in kind for value to be received [Schedule
Js].
9. Previous years figures have been re-arranged/regrouped wherever
necessary.
