NOTES FORMING PART OF FINANCIAL STATEMENTS 1. Corporate Information Binny Mills Ltd was incorporated as a Public Limited Company on 20th December, 2007. The company was issued Certificate for Commencement of Business on 6th February 2008. The CIN of the Company is L17120TN2007PLC065807. The Company is engaged in the business activities of providing services and trading of goods. The company derives rental income by letting out on rent, its warehouses situated in Perambur, Chennai, to various tenants. Apart from this the Company buys and sells textile materials (trading in textile) including retail sales to customers, from its textile division at Chennai and from the showrooms in Bangalore and Kolkata. 2. Summary of Accounting Policies The significant accounting policies followed by the company are as stated below: I. BASIS OF brPARATION OF FINANCIAL STATEMENTS The financial statements have been brpared in conformity with Generally Accepted Accounting Principles (GAAP) to comply in all material respects with the notified Accounting Standards ('AS') under Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of the Act and guidelines issued by the Securities and Exchange Board of India (SEBI).The financial statements have been brpared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the brvious year, except for the change in accounting policy explained below. Current / Non-current classification of assets / liabilities The Company has classified all its assets / liabilities into current / non-current portion based on the time frame of 12 months from the date of financial statements. Accordingly, assets / liabilities expected to be realized / settled within 12 months from the date of financial statements are classified as current and other assets / liabilities are classified as non-current. II. USE OF ESTIMATES In brparation of financial statements conforming to GAAP requirements certain estimates and assumptions are essentially required to be made with respect to items such as future obligations under employee retirement benefit plans, income taxes and the useful life period of Fixed Assets. Due care and diligence have been exercised by the Management in arriving at such estimates and assumptions since they may directly affect the reported amounts of income and expenses during the period as well as the balances of Assets and Liabilities including those which are contingent in nature as at the date of reporting of the financial statements. Presentation and disclosure in financial statements: For the year ended 31st March, 2015, schedule III of the Companies Act, 2013, is applicable to the company, for brsentation and disclosures in financial statements. The company has reclassified the brvious year's figures in accordance with the Schedule III as applicable in the current year. III. REVENUE RECOGNITION Revenues in respect of revenue from trading of goods are recognized when the significant risks and rewards of ownership of the goods have passed to the Buyer. Revenues in respect of rental income and hire charges received are recognized in accordance with the terms of the agreement. IV. FIXED ASSETS Tangible Fixed Assets Fixed assets are stated at the cost of acquisition or construction less accumulated debrciation and impairment losses, if any. All costs directly attributable to bring the fixed assets to its working condition for its intended use and borrowing costs on specified borrowings relating to the acquisition of fixed assets up to the date of commercial production are included in the cost of acquisition. Intangible Assets Intangible Assets are amortized over their useful life based on the provisions of AS 26 V. DEbrCIATION ON FIXED ASSETS Debrciation is provided over the useful lives of the assets as brscribed in SCHEDULE II to the Companies Act, 2013. VI. INVESTMENTS There are no Investments made by the company VII. INVENTORIES Stock-in-trade comprises of traded goods which are valued at lower of cost and net realizable value. Cost is determined on weighted average cost. VIII. FOREIGN CURRENCY TRANSACTIONS There are no Foreign currency transactions during the year. IX. PROVISION FOR TAXATION Provision for Current Income Tax is made in accordance with the provisions of Income Tax Act, 1961. Deferred tax assets and liabilities are measured using substantially enacted tax rates as on the Balance Sheet date. Provision for Deferred Tax is provided on timing differences. The effect of deferred tax assets and liabilities of a change in tax rates is recognized in the income statement. X. LEASES Lease rental in respect of operating lease arrangements are charged to revenue on a straight line basis over the term of the related lease agreement. XI. RETIREMENT BENEFITS Provident Fund & Employee State Insurance : Contribution to Provident Fund and Employee State Insurance is as per the Rules of the respective Acts. Gratuity: Provision for gratuity is made in accordance with AS -15 (revised) as per Actuarial Valuation using Projected Unit Credit Method and not funded. Leave encashment: The leave encashment benefit to the employees are provided in accordance with AS -15 (revised) as per Actuarial Valuation using Projected Unit Credit Method . XII BORROWING COSTS Borrowing costs attributable to the acquisition, construction or production of qualifying assets are capitalized as a part of the cost of such assets up-to the date when such assets are ready for intended use. Other borrowing costs are charged as an expense in the year in which they are incurred. XIII CASH FLOW STATEMENT The Cash flow statement is brpared under the indirect method as per Accounting Standard 3 "Cash Flow Statements". XIV EARNINGS PER SHARE The company reports basic and diluted earnings per share in accordance with the Accounting Standards - 20-'Earnings per Share'. XV SEGMENT REPORTING The Company operates in only one segment. XVI IMPAIRMENT OF ASSETS All assets other than inventories and deferred tax asset, are reviewed for impairment, wherever events or changes in circumstances indicate that the carrying amount may not be recoverable. Assets whose carrying value exceeds their recoverable amount are written down to the recoverable amount. XVII PROVISION AND CONTINGENCIES The company creates a provision when there is 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 obligation. Disclosure for a contingent liability is made when there is a possible obligation or a brsent obligation that probably will not require an outflow of resources or where a reliable estimate of the obligation cannot be made. XVIII RELATED PARTY DISCLOSURE Information on transactions with related parties has been provided in the format specified by ASI -13. Disclosure is made, party wise in respect of material related party transactions as specified by ASI -13. 2. In the opinion of the Management, all current assets, debtors and loans and advances would in the ordinary course of business realize at the value stated. 3. Debrciation has been provided based on useful life as specified in Schedule II of the Companies Act, 2013. Debrciation charge for the year has increased by Rs. 69,118/- on account of adoption of Schedule II in place of Schedule XIV to the Companies Act, 1956. The company has adjusted an amount of Rs. 13,802/- from retained earnings on account of adoption of Schedule II. 4. Total outstanding dues of Creditors to Small Scale Industrial Undertakings - Rs. Nil (Rs. Nil as on 31.3.2014).Total outstanding dues of Creditors other than Small Scale Industrial Undertakings -Rs. 117.42 lakhs (Rs. 87.56 lakhs as on 31/03/2014). 5. All operating leases entered into by the company are cancellable on giving a notice of one to three months. The operating lease amount for the year is charged to revenue. 6 There are no Micro, Small and Medium Enterprises to whom the Company owes dues which are outstanding for more than 45 days at the Balance Sheet Date, computed on unit wise basis. The above information has been determined to the extent such parties have been identified on the basis of information available with the Company. 7. There are no borrowing costs during the year. 8. Advances include a sum of Rs. 1,156.72 lakhs (Rs. 1,153.72 lakhs as on 31.3.2014) towards purchase of property due from a Company in which a director of the Company is also a director. 9. The estimated amount of contracts remaining to be executed on account of Capital account as at 31st March 2015: Rs. Nil (Rs. Nil as at 31st March 2014). 10. Provision for Wealth Tax is not made in the books as in the opinion of the management, no wealth tax is payable. 11. The Preference Dividend payable on the Cumulative Redeemable Preference Shares (CRPS) issued by the Company is as follows: On the 5,88,000 (9.75% ) CRPS of Rs.5/- each aggregating to Rs.29,40,000/-the brference dividend payable is Rs.25,08,188/- (Rs.22,21,538/- for 31-3-2014). On the 28,14,18,142 (9%) CRPS of Rs.5/- each aggregating to Rs. 140,70,90,710/-, the brference dividend payable is Rs.102,44,59,710/- (Rs. 89,78,21,546/- for 31-3-2014). The arrears of Preference Dividend are calculated from the date of original allotment of shares by Binny Ltd. Binny Ltd was demerged on 1st January 2010 (i.e., the Appointed date) vide the Order of the Madras High Court dated 22nd April 2010. The arrears of brference dividend are to be borne by the resulting companies, viz., Binny Mills Ltd and S V Global Mill Ltd, from the date of original allotment of shares by Binny Ltd. 12. Figures for the brvious year have been regrouped wherever necessary to conform to the current year's classification. V. R. Venkataachalam Chairman V. Rajasekaran Managing Director for M/s T. Selvaraj & Co Chartered Accountants Firm Regn No. 003703S S. Vidya Partner Membership No. 217934 Place : Chennai Date : 29th May 2015 |