NOTES TO FINANCIAL STATEMENTS NOTE NO. 1 1(A)Corporate Information Jindal Poly Investment & Finance Company Limited is a listed company domiciled in India & incorporated under the provision of the Companies Act. The Company is engaged in the business/area of investment and holds mainly in group Companies. 1(B)Statement on Significant Accounting Policies (a) Basis of Accounting i) The financial statements have been brpared to comply with the Accounting Standards referred to in section 133 and the relevant provisions of The Companies Act, 2013 .The financial statements have been brpared under the historical cost convention on accrual basis. The accounting policies have been consistently applied by the Company unless otherwise stated. ii) All assets and liabilities are classified as current or non-current as per the Company's normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, 12 months has been considered by the Company for the purpose of current/ non-current classification of assets and liabilities. (b) Recognition of Income and Expenditure All revenues and expenditures are accounted for on accrual basis except wherever stated otherwise. (c) Investments Current Investments are valued at acquisition cost or market value whichever is lower. Non- Current investments (Long Term) are valued at acquisition cost. Diminution in value of Non-Current investment is provided only if such a diminution is other than temporary in the opinion of the management (d) Employee Benefits i. Short term Employee Benefits All employee benefits payable within twelve months of rendering the service are classified as short term employee benefits. Benefits such as salaries, wages etc. and the expected cost of bonus, exgratia, incentives are recognized in the period during which the employee renders the related service. ii. Post-employment Benefits (a) Defined Contribution Plans State Government Provident Fund Scheme is a defined contribution plan. The contribution paid/payable under the scheme is recognized in the profit & loss account during the period during which the employee renders the related service. (b) Defined Benefit Plans The employee Gratuity Fund Scheme managed by a trust is a defined benefit plan. The brsent value of obligation under such defined benefit plan is determined based on actuarial valuation under the projected unit credit method which recognizes each period of service as giving rise to additional unit of employees benefits entitlement and measures each unit separately to build up the final obligation. The obligation is measured at the brsent value of future cash flows. The discount rates used for determining the brsent value of the obligation under defined benefit plans is based on the market yields on government securities as at balance sheet date, having maturity periods approximated to the returns of related obligations. Actuarial gains and losses are recognized immediately in the profit & loss account. In case of funded plans the fair value of the planned assets is reduced from the gross obligation under the defined benefit plans to recognize the obligation on net basis. (c) The obligation for leave encashment is provided for and paid on yearly basis. (e) Borrowing Costs Borrowing costs that are directly attributable to the acquisition of assets are being capitalized as part of the cost of that asset up to the date of such asset is ready for its intended use. All other borrowing costs are charged to revenue in the period when they are incurred. (f) Taxation i) Current Year Charge Provision for Income-tax is ascertained on the basis of assessable profits computed in accordance with the provisions of the Income-tax Act, 1961. ii) Deferred Tax The company provides for deferred tax using the liability method, based on the tax effect of timing difference resulting from the recognition of items in the financial statements and in estimating its current income tax provision subject to consideration of prudence. However, the deferred tax benefits, if any, are recognised only when such benefits are expected to be realisable in near future. (g) Earnings per share Earnings per share is calculated by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. (h) Miscellaneous Expenditure Preliminary expenditure/ share issue expenses are being written off over a period of five years. (i) Income from investments/Deposit Income from investments is credited to revenue in the year in which it accrues. Income is stated in full with the tax thereon being accounted for Under Income tax deducted at source. Dividend income is booked, when the owner's right to receive its investments payment in shares established. (j) Cash Flow Statement Cash Flows are reported using the Indirect Method, whereby profit/ (loss) before extraordinary Items and tax is adjusted for the effects of transaction of non-cash nature and deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the company are segregated based on the available information. (k) Contingent Liability Contingent Liabilities, if material, are disclosed by way of notes. (l) Other accounting policies are in accordance with generally accepted accounting principles. 2. There is no liability outstanding as on 31.03.2015 due to Small Scale and medium enterprises as defined under the Micro Small and Medium Enterprises Development Act, 2006. 3. Non-Current Investment include 6 shares of Jindal Poly Films Investment Ltd. of which the Company is beneficial owner are held by certain individuals in fiduciary capacity. 4. Segment Reporting An operating segment is a component of the business: i) That engages in business activities as a result of which the company receives operating revenues and incurs costs, ii) Whose operating results are regularly reviewed by the company's ultimate decision-maker with a view to determining which resources should be allocated to the segment and to assess its earnings, and iii) For which separate financial information exists. It is management's perception that since the company is engaged in the activity of investment of its surplus fund in the share capital of other company and mutual fund which are governed by the same set of risk and returns the same are considered to constitute a single reportable segment in the context of Accounting Standard on "Segment Reporting" issued by the Institute of Chartered Accountants of India. 5. Pledge of Shares of M/s Jindal India Powertech Limited to IFCI Limited The Company has pledged 15,41,00,000 Equity Shares of Rs 10/- each and 24,71,00,000 Zero Percent Redeemable Preference Shares Series I and 3,88,00,000 Zero Percent Redeemable Preference Shares Series II of Rs 10/- each, both fully paid up of Jindal India Powertech Limited "JIPL, an associate Company to IFCI Limited as security for 14% OCD issued by JIPL and subscribed by IFCI Ltd in terms of the Debenture subscription agreement between JIPL and IFCI Ltd for the sum of Rs 300 Crore (outstanding as on 31.03.2015 Rs 275 Crore). 6 Core Investment Company The Company is a core Investment Company Holding more than 90% of its assets in investments in shares or debt in group Companies. In view of the interbrtation of the extent regulatory framework applicable to core investment companies, certificate of Registration under sub-section (2) section 45-IA of the Reserve Bank of India Act, 1934 is required and the steps are being taken by the Company. 7. Allotment of Zero Percent Redeemable Preference Shares During the Financial Year, M/s Jindal India Powertech Limited has allotted 12,50,00,000 Zero percent redeemable brference shares of Rs. 10/- each, in lieu of Preference Share Application Money. These Shares were allotted on 07th June, 2014. Terms & Conditions (in brief) a) The Redeemable Preference Shares (hereinafter referred to as 0% RPS-Series II) shall have a face value of Rs 10/- (Rupees Ten Only) each. b) The 0% RPS- Series II will be allotted as fully paid up @ Rs 10/- (Rupees Ten Only) per share. c) The 0% RPS- Series II shall not carry any dividend. d) The 0% RPS- Series II shall not carry any voting rights except in accordance with the provision of Section 47 of the Companies Act, 2013. e) The 0% RPS- Series II shall be redeemed as per provisions of Companies Act, 1956 or Companies Act, 2013, as may be applicable, at a brmium of 10%, within 15 years from the date of their allotment as may be decided by the Boards of Directors of the company. f) Any part redemption of 0% RPS- Series II will be permissible as may be approved by the Board of Directors of the Company. g) Any other condition to be added or modified, from time to time, as may be approved by the Board of Directors of the Company for compliance of all statutory guidelines and provisions as may be deemed fit in the interest of the company. 8 There is no amount required to be transferred in Investor education and protection fund. 9. Corporate Social Responsibility: The Company has not spent any amount in the current financial year. However, the Company is actively considering various CSR programs that may be taken up in the next Financial Year. Gross amount required to be spent by the Company during the year Rs. 18,87,058. Amount spent by the company during the year is Nil. 10. Figures have been rounded off to nearest rupee. The accompanying Notes are Integral Part of the Financial Statements As per our report of even date annexed hereto For UBS & Company Chartered Accountants Firm Regn No: 012351N Bhimraj Agarwal Partner Membership No.090909 Pramod Chauhan Company Secretary G.D. Singal Managing Director DIN:00708019 Hemant Sharma Director DIN: 05235723 Pavan Kumar Chief Financial Officer Place: New Delhi Dated: 30.05.2015 |