NOTES FORMING PART OF THE FINANCIAL STATEMENTS

1 Estimated amount of contracts remaining to be executed is Rs. 1353/- thousands (P.Y. Rs. 260/- thousands).

2 LEASE

Income

The Company has let out its certain factory brmises under operating lease during the year. These lease are cancellable by either party giving a notice of one month. Rent Income is recognized in the Statement of Profit and Loss as “Rent Income” under Note No.19.

Expenses

The company has obtained office brmises under operating lease. These are generally cancellable lease. These leases are under operating lease and are renewable by mutual consent on mutually agreeable terms.

Lease payments are recognized in the Statement of Profit and Loss account as “Rent Expenses” under Note No.25.

3 The operations of the Company are limited to one segment, namely, “Manufacturing of Machineries and Components”.

4 The value of realization of assets other than fixed assets and non current investment in the ordinary course of business will not be less than the value at which they are stated in the Balance Sheet.

5 As per the opinion of the management, Deferred tax assets of Rs. 22,831 thousands on Carried Forward Business Loss/Unabsorbed debrciation is recognised and carried forward only to the extent that there is virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised.

6 The balances of trade receivables and trade payables are subject to adjustment if any on reconciliation/settlement.

7 Previous periods figures are for the fifteen months and therefore current years figures are not comparable with those of the brvious period. Figures of the Previous period have been regrouped/ reclassified wherever necessary.

For K. C. Mehta & Co.

Chartered Accountants

Vishal P. Doshi

Partner

Membership No. 101533

Place : Vadodara

Date : May 12, 2016

For and on behalf of Board of Directors

Adrian Oehler Director DIN: 00360332

Shalin S. Divatia Director DIN:00749517

Bhavin Kariya CFO

Harneetkaur Anand Secretary

Place : Halol

Date: May 12, 2016

NOTES FORMING PART OF THE FINANCIAL STATEMENTS:

NOTE 1: CORPORATE INFORMATION

INTEGRA Engineering India Limited is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The Company is engaged in manufacturing of machineries and components.

NOTE 2: SIGNIFICANT ACCOUNTING POLICIES

1. Basis of Preparation of Financial Statements:

The financial statements are brpared under the historical cost convention in accordance with the generally accepted accounting principles in India. The applicable mandatory

Accounting Standards brscribed under section 133 of the Companies Act, 2013 have been followed in brparation of these financial statements.

2. Use of Estimates:

The brparation of financial statements requires the management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management believes that these estimates and assumptions are reasonable and prudent. However, actual results could differ from estimates. Differences between the actual results and the estimates are recognised in the period in which the same are known/materialised.

3. Revenue Recognition:

(i) Sales :

Revenue from sale of goods is recognized when the significant risks and rewards in respect of ownership of products are transferred to the buyer under the terms of contract. Sales are inclusive of excise duty but are net of sales returns, sales tax and rate difference adjustments if any.

The company accounts for income on the percentage of completion basis, which necessarily involve technical estimates of the percentage of completion and cost of completion of each contract/activity. Such estimates made by the company and have been relied upon by auditors, as these are of a technical nature.

(ii) Interest Income:

Interest on investments is booked on a time proportion basis taking into account the amounts invested and the rate of interest.

(iii) Other Income:

Other income is recognized on accrual basis except when realisation of such income is uncertain.

4. Investments:

Investments are either classified as current or long term based on the management contention at the time of purchase. Long term investments are shown at cost. However, when there is decline, other than temporary in the value of long term investment, the carrying amount is reduced to recognise the decline. Current investments are stated at lower of cost or market value.

5 Borrowing Cost:

Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalized as part of such assets. A qualifying asset is an asset that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing costs are recognized as expense in the period in which they are incurred.

6 Fixed Assets:

Fixed Assets are stated at cost, net of tax/duty credit availed, if any, after reducing accumulated debrciation until the date of the Balance Sheet. Direct cost are capitalized until the asset are ready for use and include financial cost relating to any borrowing attributable to acquisition. Capital work in progress includes the cost of fixed assets that are not yet ready for the intended use.

7 Debrciation

Debrciation on tangible assets has been provided on straight line method over the useful lives of the assets brscribed under Part C of Schedule II of the Companies Act, 2013. Debrciation on additions/deletion during the year is provided on pro rata basis.

8 Intangible Assets and amortisation

Intangible assets are recognized only if it is probable that future economic benefits that are attributable to the assets will flow to the enterprise and the cost of assets can be measured reliably. The intangible assets are recorded at cost and are carried at cost less accumulated amortization and accumulated impairment losses, if any. Intangible assets are amortized over the estimated period of benefit, not exceeding ten years.

9 Impairment of Assets:

The company assesses at each Balance Sheet date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the asset. If such recoverable amount of the asset or the recoverable amount of the cash generating unit to which the asset belongs is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an impairment loss and is recognized in the Statement of Profit & Loss. If at the Balance Sheet date, there is an indication that if a brviously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount.

10. Leases

Assets leased out where a significant portion of the risks and rewards of ownership are retained by the company are classified as operating leases. Lease rentals are recognised in the Statement of Profit and Loss.

Assets acquired on leases where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Lease rentals are charged to the Statement of Profit and Loss.

11. Inventories:

The inventories are valued at cost or net realizable value whichever is lower. The basis of determining the value of each class of inventory is as follows:

Inventories -Cost Formula

Raw material -Weighted average cost

Work in Progress -Raw material cost plus conversion cost, wherever applicable

Stock in trade -At landed cost

Stores and Spare Parts -Weighted average cost

12. Foreign Currency Transactions :

Foreign currency transactions during the year are recorded at the rate of exchange brvailing on the date of the transactions.

At the year end, all the monetary assets and liabilities denominated in foreign currency are restated at the closing exchange rates. Exchange differences resulting from the settlement of such transactions and from the translation of such monetary assets and liabilities are recognised in the Statement of Profit and Loss.

In case of forward exchange contacts, the brmium or discount arising at the inception of such contracts, is amortized as income or expense over the life the contract as well as exchange differences on such contract i.e. difference between the exchange rate at the reporting/settlement date and the exchange rate on the date of inception of contract/the last reporting date, is recognized as income/expense for the period.

13. Employee Benefits:

(a) Post Employment Benefits:

i) Defined Contribution plan The company's contribution to defined contribution plan paid/payable for the year is charged to the Statement of Profit and loss.

ii) Defined Benefit plan The liabilities towards defined benefit schemes are determined using the Projected Unit Credit method. Actuarial valuations under the Projected Unit Credit method are carried out at the balance sheet date. Actuarial gains and losses are recognized in the Statement of Profit and Loss in the period of occurrence of such gains and losses. Past service cost is recognized immediately to the extent that the benefits are already vested and otherwise it is amortized on straight-line basis over the remaining average period until the benefits become vested.

The retirement benefit obligation recognised in the balance sheet rebrsents the brsent value of the defined benefit obligation as reduced by the plan assets.

(b) Short-term employee benefits

Short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised undiscounted during the period employee renders services. These benefits include salary, wages, bonus, performance incentives etc.

(c) Long term employee benefits

Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognized as an actuarially determined liability at brsent value of the defined benefit obligation at the balance sheet date.

14. Taxes on Income :

The provision for taxation is ascertained on the basis of assessable profits computed in accordance with the provisions of the Income-tax Act, 1961.

Deferred tax assets and liabilities are recognized on timing differences, being the differences between taxable income and accounting income, that originate in one period and are capable of reversal in one or more subsequent periods using tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax assets, other than on unabsorbed debrciation and carried forward losses, are recognised only if there is reasonable certainty that they will be realised in the future. Deferred tax assets in respect of unabsorbed debrciation and carry forward losses are recognized if there is virtual certainty that there will be sufficient future taxable income available to realize such losses. Deferred Tax assets are reviewed at each balance sheet date for their realisability.

15. Provisions, Contingent Liabilities and Contingent Assets:

The company recognizes a provision when there is a brsent obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that may, but probably will not, require an outflow of resources. Where there is a possible obligation or a brsent obligation that the likelihood of outflow of resources is remote, no provision or disclosure is made. Contingent assets are neither recognised nor disclosed.