(B)     SIGNIFICANT ACCOUNTING POLICIES

a)      Basis of Preparation and Presentation

The Financial Statements are brpared under the Historical Cost convention and on the accounting principle of going concern basis. The Company follows generally Mercantile System of Accounting except in case of gratuity and leave encashment.

b)      Property, Plant and Equipment

Property, Plant and Equipment are recorded at the Cost of Acquisition. Cost excludes excise duties to the extent recoverable and Value Added Tax and includes other directly attributable costs incurred to bring the assets to their intended working condition.  The amount of interest if any directly attributable to acquisition of the fixed assets stands capitalized.

Debrciation

In respect of Property, Plant and Equipment acquired during the year, debrciation/ amortization is charged on a straight line basis so as to write off the cost of the assets over the useful lives and for the assets acquired prior to April 1, 2014, the carrying amount as on April 1, 2014 is debrciated over the remaining useful life. Debrciation is provided based on useful life of the assets as brscribed in Schedule II to the Companies Act, 2013 as follows:

ASSET CATEGORY	USEFUL LIFE BASED ON SLM
Office Building	30 years
Factory building	30 years
Plant and Equipment	15 years
Furniture and Fixture	10 years
Vehicles	10 years
Office Equipment	5 years
Computers and Laptops	3 years
Intangible Assets	10 years

c)       Intangible Assets

Intangible Assets are stated at cost of acquisition net of recoverable taxes, trade discount and rebates less accumulated amortization/depletion and impairment loss, if any. Such cost includes purchase price, borrowing costs, and any cost directly attributable to bringing the asset to its working condition for the intended use, net charges on foreign exchange contracts and adjustments arising from exchange rate variations attributable to the intangible assets.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the Statement of Profit and Loss when the asset is derecognised.

Intangible assets are amortised on a straight-line basis over the period of estimated useful Lives of 10 years.

d)      Inventories

Closing Stock is valued at cost & includes all incidental charges. Stock of Raw Materials and Finished Goods are exclusive of excise duty.

e)      Translation of Foreign Currency Items

Transactions in foreign currency are accounted for at the customs exchange rate for the month.    Gains/losses arising out of fluctuations in foreign exchange rates between the transaction date and settlement date are recognized in the Profit & Loss account, except in case of fixed assets, where these are adjusted to the carrying cost of the respective assets.

Monetary items denominated in foreign currency are restated at the exchange rate brvailing at the year end and the overall net gain/loss is adjusted to the Profit & Loss Account.

f)       Cash Flow Statement

Cash Flow statement as required by Accounting Standard 3 is annexed.

g)      Research and Development Expenditure

Revenue expenditure pertaining to research is charged to the Statement of Profit and Loss. Development costs of products are charged to the Statement of Profit and Loss unless a product’s technological and commercial feasibility has been established, in which case such expenditure is capitalized.

h)      Finance Cost

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use. Interest income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.  All other borrowing costs are charged to the Statement of Profit and Loss for the period for which they are incurred.

i)        Provisions

Provisions are recognised when the Company has a brsent obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

j)        Employee Benefits Expense

Short Term Employee Benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognised during the period when the employee renders the service. These benefits include compensated absences such as paid annual leave and performance incentives.

Post-Employment Benefits

Defined Contribution Plans

A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund, Superannuation Fund and Pension Scheme. The Company’s contribution is recognised as an expense in the Statement of Profit and Loss during the period in which the employee renders the related service.

Employee Separation Costs

Compensation to employees who have opted for retirement under the voluntary retirement scheme of the Company is payable in the year of exercise of option by the employee. The Company recognises the employee separation cost when the scheme is announced and the Company is demonstrably committed to it.

k)      Tax Expenses

The tax expense for the period comprises current and deferred tax. Tax is recognised in Statement of Profit and Loss.

- Current tax

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted at the Balance sheet date.

- Deferred tax

Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit.

Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of deferred tax liabilities and assets are reviewed at the end of each reporting period.

-Minimum Alternate Tax

Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the Company will pay normal income tax after the set-off of brvious years Losses. Accordingly, MAT is recognised as an asset in the balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with it will fructify.

l)        Revenue Recognition

Revenue from sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the associated cost can be estimated reliably, there is no continuing effective control or managerial involvement with the goods, and the amount of revenue can be measured reliably. Revenue from sale of goods is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government. Revenue from operations includes sale of goods and gain/ loss on corresponding exports sales and does not include amounts of service tax/excise duty/VAT.

Interest income

Interest income from a financial asset is recognised using effective interest rate method.

Dividends

Revenue is recognised when the Company’s right to receive the payment has been established.

(C)  NOTES ON FINANCIAL STATEMENTS:

(1)     During the year the company has changed its accounting software from Tally to SAP, due to this change the company has adopted net basis of accounting for taxes (excise duty, service tax and VAT). The Statement of Profit and Loss shows excess of Rs 2,02,93,249/- being the opening balance of Cenvat Credit as per the returns filed now restated in the books for net basis of accounting.

(2)     Loans, Debtors, Creditors and Deposits are as per the books and are subject to confirmation.

(3)     Taxation

Provision for current tax is made and retained in the accounts on the basis of estimated tax liability as per the applicable provisions of the Income-tax Act, 1961.

(i)                        Deferred Tax As On 31/03/2017

‘	DTA	DTL
Debrciation & Fixed Assets	-	7,73,00,414
Bonus	21,14,779	-
Current Year Loss Carried Fwd	-
B/F Debrciation loss	1,77,14,805	-
TOTAL	1,98,29,584	7,73,00,414
DEFERRED TAX LIABILITY AS ON 31/03/2017		5,74,70,830

(4)    Major Stock records / Excise records are maintained at works i.e. at Vapi Factory.   Stock Tally is given in Annexure attached to financial statements as per Schedule - III and is compiled and certified by the Directors. Closing Stock valuation is done by management which is relied upon by the Auditors.

(5)    Additional information pursuant to provisions of Schedule III to the Companies Act, 2013.

(a)   TURNOVER:

1.      Details of Manufactured Goods/Sales/Stocks

	Opening Stock		Production		Sales		Closing Stock
Class of  Goods
	Oty (in Kgs)	Value	Oty (in Kgs)	Value	Oty (in Kgs)	Value	Oty (in Kgs)	Value
	(in `)	(in `)	(in `)	(in `)
Chemicals & Chemicals Products
421970	176445549	4998006	2033966143 (1717905678)	5026676	1961764420	393300	160055607
-439064	-194152479	-4108376		-4125470	-1920445642	-421970	-176445549
Total	421970	176445549	4998006	2033966143	5026676	1961764420	393300	160055607

                 Figures in brackets are for brvious years.

2.   Details of Raw Materials Consumed

	2016-17 Qty in Kg	2016-17 Value (In Rs)	2015-16 Qty in Kg	2015-16 Value (In Rs)
Hydroquinone	968163	287042258	682782	255993696
Other Raw Materials*	7025748	2051643274	3868070	1061997817
TOTAL	7993911	2338685532	4550852	1317991513

 (*None of these items individually exceed 10% of the Total Value of Raw Materials Consumed)

(b)   Payment to Directors

Mr. Nilesh V. Jhaveri	Remuneration	52,00,000/-
Mr. Parag V. Jhaveri	Remuneration	52,00,000/-
Mr. Yayesh V. Jhaveri	Remuneration	52,00,000/-
Mr. Vinod H. Jhaveri	Remuneration	39,00,000/-

     (c)  Expenditure in foreign currency

Particulars	Current Year	Previous Year
C.I.F. value of Goods imported	104,50,02,256	106,00,33,812
Foreign Travel	11,17,116	31,67,909
Commission	23,03,398	16,80,084
Certificate Expenses	1,46,287	3,32,252
Membership & Subscription	Nil	Nil

(d)   Earning in foreign exchange

FOB value of goods Exported

1,23,41,19,408

95,46,86,604

(6)    Information on leases as per Accounting Standard 19 on “Accounting for Leases”

      Operating Lease Expense:

Rental expenses for operating leases recognised in Profit & Loss A/c. For the year is	Rs.     33,42,500
Total future minimum lease payments under non-cancelable operating leases:
Not Later than one year	Rs.     67,50,000
One year to later than Five years	Rs.  3,04,84,932
Later than Five years	Rs.        NIL
Total	Rs. 4,05,77,432

(7)       Segment Reporting as per Accounting Standard 17

The Company operates in single Business segment of “Chemicals”. Therefore the Company is of the opinion that the disclosure requirements of Accounting Standard AS – 17 issued by the ICAI are not applicable to the Company.

(8)    RELATED PARTY TRANSACTIONS

      Disclosures as required by Accounting Standard 18 – “Related Party Disclosures” are

      1]         LIST OF RELATED PARTIES:

a)                  Key Management Personnel:

Mr. Nilesh V. Jhaveri	Director
Mr. Parag V. Jhaveri	Managing Director
Mr. Yayesh V. Jhaveri	Director
Mr. Vinod H. Jhaveri	Director

b)                  Relatives:

Mr. Vinod H. Jhaveri (HUF)	HUF of Mr. Vinod H. Jhaveri
Mrs. Niranjana V. Jhaveri	Mother of the Directors
Mr Nilesh Jhaveri (HUF)	HUF of Mr. Nilesh Jhaveri
Mrs. Jigna N. Jhaveri	Wife of Mr. Nilesh Jhaveri
Mr Parag Jhaveri (HUF)	HUF of Mr. Parag Jhaveri
Mrs. Neha P. Jhaveri	Wife of Mr. Parag Jhaveri
Yayesh Jhaveri (HUF)	HUF of Mr. Yayesh Jhaveri
Mrs Payal Y. Jhaveri	Wife of Mr. Yayesh Jhaveri

2]  TRANSACTIONS WITH RELATED PARTIES:

NATURE OF TRANSACTIONS	KEY MANAGEMENT PERSONNEL	RELATIVES OF KMP	TOTAL
Expenses:
Managerial Remuneration	1,95,00,000	NIL	1,95,00,000
Rent	NIL	1,20,000	1,20,000
Interest on Loans	4,60,59,956	1,99,113	4,62,59,069
Loans taken as on 31/3/2017	36,60,80,017	26,62,285	36,87,42,302

(9)    Disclosure on Specified bank Notes

During the year, the Company had specified bank notes (SBNs) and other denomination notes as defined in the MCA notification G.S.R. 308(E) dated 31st March, 2017, on the details of Specified Bank Notes (SBNs) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per the notification is given below:

Particulars	SBNs*	Other denomination notes	Total
Closing cash in hand as on 08/11/2016	4,00,000	3,139	4,03,139
(+) Permitted receipts	NIL	16,24,600	16,24,600
(-) Permitted payments	NIL	12,54,529	12,54,529
(-) Amount deposited in banks	4,00,000	NIL	4,00,000
Closing cash in hand as on 30/12/2016	NIL	3,73,210	3,73,210

* For the purpose of this clause ‘Specified Bank Notes’ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3407(E), dated the 8th November, 2016.

(10)     Corporate Social Responsibility

As per Section 135 of the Companies Act, 2013, a company meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately brceding three financial years on Corporate Social Responsibility (CSR) activities. A CSR committee has been formed by the company as per the Act. The gross amount required to be spent by the company as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof during the year is Rs 5.54 Lakhs. The company has not spent any amount on CSR activity as this is the first year of CSR applicability to the company and the Directors are in the process of identifying suitable project for CSR.

(11)     Earnings Per Share (EPS)

PARTICULARS	2016-17	2015-16
Net Profit after Tax as per Statement of Profit and Loss attributable to Equity Shareholders (Rs Lakhs)	Rs. 266.26/-	Rs. 165.81/-
Weighted Average number of Equity Shares used as denominator for calculating EPS	10,00,00,000	10,00,00,000
Basic Earnings per Share (Rs)	0.27	0.17
Diluted Earnings per Share (Rs)	0.27	0.17
Face Value per Equity Share (Rs)	1	1

(12)     he accounting for Auditor’s remuneration will be done on payment basis.

(13)     Contingent Liabilities: There are no Contingent Liabilities to report.

(14)     The Company is in the process of identifying the small-scale and Micro, Small and Medium Enterprises and hence : Interest, if any, payable as per Interest on Delayed Payment to Small Scale and Ancillary Industrial undertakings Ordinance,1993 and the Micro, Small and Medium Enterprises Development Act,2006 is not ascertainable, and Amount payable to small-scale units is not ascertainable.

(15)     The company has not fully received the insurance amount for goods destroyed by fire. Company has brferred an appeal by way of arbitration proceeding against the insurance company. Awaiting decision on the said matter, we have not expensed the said short receipt as loss by fire in the current year.

(16)     Previous Year figures have been re stated/ re grouped wherever necessary. The brvious year’s figures of the Financial Statements are not comparable since the company has adopted net basis of accounting for taxes (excise duty, service tax and VAT) from the Current Year.

AS PER OUR REPORT OF EVEN DATE                                                                 

For G.V. RADIA AND ASSOCIATES                          FOR AND ON BEHALF OF BOARD OF DIRECTORS

Chartered Accountants

 Gaurav Radia                                                                           (DIRECTORS)

 Partner

 Membership No. 156857

 Firm Reg. No. 138160W

PLACE: MUMBAI            

DATE   :  28/07/2017

(A)     CORPORATE INFORMATION

Yasho Industries Private Limited is a company incorporated in India and has its registered office in Mumbai, India. The Company operates in the Business of “Chemicals” and has two factories situated in GIDC, Vapi, Gujarat. 

As per Disclosure of Accounting Policies 

Employee Benefits Expense

Short Term Employee Benefits

The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees is recognised during the period when the employee renders the service. These benefits include compensated absences such as paid annual leave and performance incentives.

Post-Employment Benefits

Defined Contribution Plans

A defined contribution plan is a post-employment benefit plan under which the Company pays specified contributions to a separate entity. The Company makes specified monthly contributions towards Provident Fund, Superannuation Fund and Pension Scheme. The Company’s contribution is recognised as an expense in the Statement of Profit and Loss during the period in which the employee renders the related service.

Employee Separation Costs

Compensation to employees who have opted for retirement under the voluntary retirement scheme of the Company is payable in the year of exercise of option by the employee. The Company recognises the employee separation cost when the scheme is announced and the Company is demonstrably committed to it.

  Segment Reporting as per Accounting Standard 17

The Company operates in single Business segment of “Chemicals”. Therefore the Company is of the opinion that the disclosure requirements of Accounting Standard AS – 17 issued by the ICAI are not applicable to the Company.