Vesuvius India Limited — (31-12-2009)
From Significant Accounting Policies :
Fixed Assets :
(a) Cost :
Fixed assets are stated at cost of acquisition (net of CENVAT)
less accumulated depreciation/amortisation. Cost of acquisition includes taxes,
duties, freight and other costs that are directly attributable to bringing
assets to their working condition for their intended use. Spares that can be
used only with particular items of plant and machinery and such usage is
expected to be irregular are capitalised.
During the year, the Company has changed its accounting
policy for toolings to comply with the opinion of the Expert Advisory Committee
of the Institute of Chartered Accountants of India in this regard. Consequent to
such change, toolings used for the production of finished goods have been
recognised as fixed assets. Depreciation for the year on such toolings have been
provided for based on their estimated useful lives of 3 years. Hitherto, such
toolings were considered as inventories and were being amortised over their
estimated useful lives of 3 years. Consequently, during the year :
— Cost of acquisition aggregating Rs.140,561 (previous year
Rs.106,886) of toolings that had not been fully amortised till the previous
year-end has been added to gross block of fixed assets as at the beginning of
the year.
— Amortised Cost aggregating Rs.92,644 (previous year
Rs.65,751) of toolings that had not been fully amortised till the previous
year-end has been added to accumulated depreciation at the beginning of the
year.
— Cost of acquisition of toolings purchased during the year
aggregating Rs.18,005 (previous year Rs.33,675) has been recognised as addition
to fixed assets
— Depreciation for the year on toolings Rs.27,904 (previous
year Rs.26,893) has been provided for based on their aforesaid useful lives.
Had the Company continued to recognise toolings as inventory
:
— inventory of toolings at the year-end would have been
higher by Rs.38,018 (previous year Rs.47,917) and net block of fixed assets at
the year-end and at the previous year-end would have been lower by corresponding
amounts.
— toolings consumed during the year would have been higher by
Rs. 27,904 [previous year Rs.26,893] and depreciation charge for the year and
the previous year would have been lower by corresponding amounts.
The above reclassification had no impact on profit after tax
for the year.
2 Approval pending for transactions covered u/s.297 of
Companies Act, 1956
Castrol India Limited — (31-12-2009)
From Notes to Accounts
:
The Company has
entered into transactions for rendering of services and secondment of personnel
with two private limited companies incorporated in India, which are a part of
the BP group of companies worldwide. The said agreements attracted the
provisions of Section 297 of the Companies Act, 1956 as there were common
Directors between the Company and the two private limited companies. The Company
is applications to the Regional Director (Ministry of Corporate Affairs) for
necessary approvals. The Regional Director (Ministry of Corporate Affairs) has
sought clarifications and requested the Company to make fresh applications with
additional information. The Company has made fresh applications in relation to
both the private limited companies to the Regional Director (Ministry of
Corporate Affairs) and is currently awaiting approval.
Non-provision of impairment loss
Ciba India Limited — (31-3-2009)
From Notes to Accounts :
13. The Company has fixed assets on the leased
premises at Goa. The carrying value of the fixed assets at the said leased
premises Rs.120,633 including the assets which cannot be moved is Rs.70,177 as
at the year-end. The lease of the premises expired on August 31, 2008 and
pending the final outcome of the Company’s negotiations in respect of the same,
no impairment is assessed on the fixed assets at the leased premises and
depreciation on these assets is provided as per the Company‘s policy. The
company has relied on independent valuation report of January, 2008 and as the
value of assets is more than the carrying value, no impairment is deemed
necessary.
From Auditors’ Report
5. As more fully described in Note 13 to the
financial statements, pending the final outcome of the Company’s negotiations in
respect of premises leased to it, the Company has not assessed the fixed assets
at the said premises for impairment, if any. The carrying value of fixed assets
at the said leased premises is Rs.120,633 thousands including immovable assets
of Rs.70,117 thousands as identified by the Company. We are unable to comment
the effect of adjustments, if any, had such assessment for impairment been
carried out.
6. Further to our comments in the Annexure referred
to in para 3 above, and except for matter referred to in para 4 above, we report
that :
