Action Construction Equipment

1.  Out of the Funds raised through IPO Rs. 5980 lac, Rs.  5484 lac
 (see annexure) have been utilized till 31st March, 2009 and balance
 amount is lying unutilised & will be util ised as per amendments made
 to Proposed Deployment of Funds by the shareholders of the Company in
 its Annual General Meeting held on 1st August, 2008. The Shareholders
 of the Company have authorised the Board of Directors to utilise
 remaining IPO proceeds in the best interest of the Company. The
 unutilised funds have been temporarily invested in Fixed Deposits with
 Bank.
 
 2.  The Board of Directors has recommended dividend Rs. 0.40 per
 Equity Share of Rs. 2 each (20%), subject to approval of Share Holders.
 
 3.  During the year, the company has incorporated a wholly owned
 Subsidifiry, namely Action Developers Ltd.
 
 4.  Miscellaneous Expense to the extent not written off, includes Life
 Time Club Membership, to be amortized over a period often years,
 commencing from 2007-08, in accordance with Accounting Standard 26
 issued by The institute of Chartered Accountants of India.
 
 5.  In absence of any information requested from the vendors with
 regards to their registration (filing of Memorandum) under The Micro,
 Small and Medium Enterprises Development Act, 2006 (27 of 2006),
 liability can not be ascertained at the close of the year and hence no
 disclosures have been made in this regards.
 
 6.  Contingent Liabilities, not provided for: 
                                                  (Rs. in lac)
     Particulars                     2008-09         2007-08
 
 Bank Guarantees including Corporate 
 Guarantees                           293.80          731.10
 Letter of Credits                    195.33          842.68
 Claim against the Company, 
 not acknowledge as Debts             148.43           53.42
 Sales Tax, Excise & Income Tax 
 Matters, pending before Assessing/
 Appellate Authorities                 28.33            8.63
  Total                               665.89        1,635.83
 
 7. As per Accounting Standard 18, Related Party Disclosure issued by
 The Institute of Chartered Accountants of India, the disclosures of
 transactions with the Related Parties as defined in the Accounting
 Standard are given below-
 
 a.  Associate Companies / Entities-
 
 ACE Steelfab Pvt. Ltd.  
 ACE TC Rentals Pvt. Ltd.  
 Namo Metals
 
 b.  Subsidiary Companies.
 
 FRESTED Limited, Cyprus 
 Wholly Owned Subsidiary
 
 SC FORJ-IA SA, 
 Romania Fellow Subsidiary
 
 ACTION DEVELOPERS Limited, India 
 Wholly Owned Subsidiary
 
 c.  Key Management Personnel- 
 Mr. Vijay Agarwal 
 Mrs. Mona Agarwal 
 Mr.Sorab Agarwal 
 Mr. Vijay K. Singh
 
 d. Relatives of Key Management Personnel and
 Enterprises,  over which Relatives of Key
 Management Personnel exercise significant
 influence-
 Mrs. Surbhi Garg
 
 8. The Company has entered into agreements in the nature of Lease/
 Leave and Licence agreement with different Lessors/ Licensors for the
 purpose of establishment of office premises/ residential
 accommodations. These are generally in nature of operating Lease/leave
 and Licence and disclosure required as per Accounting Standard-19
 issued by The institut e of Chartered Accountants of India with regard
 to the above is as under-
 
 (a) Payment under Lease/Leave and License for period:
 
 1.  Not later than 1 year Rs. 25.41 lac
 
 2.  Later than 1 year, but not later than 5 years Rs. 24.92 lac.
 
 (b) Then; are no transactions in the nature of Sub
 
 Lease.
 
 (c) Paynien . Unrcognised in the profit and Loss Account for the year
 ended 31st March, 2009 is Rs.63.46 lac.
 
 E) Actuarial Assumption-
 
 a) Discounted Rate 8% p.a.
 b) Mortality Rate LIC (1994-1996) Ultimate
 c) Withdrawal rate 1% to 3%, depending on age
 d) Salary Escalation 5%
 e) Retirement Age 58
 
 Liability in respect of una vailed priviledge leave was hitherto valued
 at the salary rates prevailing on the balance sheet c ate. During the
 year, the company has valued the compensated absences, specified in AS
 15 (Revised) on actuarial basis. Further para 132 of AS 15 (Revised
 2005) does not require any specific disclosure except where the expense
 resulting from compensated absences is of such size, nature of
 incidence that its disclosure is relevant under other Accounting
 Standards. In the opinion of the management, the expense resulting from
 compensated absences is not significant and hence no disclosures are
 prepared under various paragraphs of Accounting Standard 15 (Revised
 2005) issued by The institute of Chartered Accountants of India.
 
 9.  All Credit Facilities from Banks are secured by way of
 hypothecation of the Campanys entire stocks of raw materials,
 semi-finished and finished goods, consumable stores and spares and such
 other movable including book-debts, bills whether documentary or clean,
 outstanding monies, receivables, both presant & future and Plant &
 Machinery on pari passu basis and First charge by way of equitable
 mortgage of property situated at Tajru Road. 25th Mile Stone, Delhi
 Mathura Road, Ballabhgarh, Haryana on pari passu basis.
 
 10.  Balance of Sundry Debtors and Sundry Creditors are subject to
 confirmation by the parties and adjustment, if any, required on
 reconciliation, will be done in the year in which the same is
 reconciled. Further, Management does not expect any material difference
 in the financial statements for the year.
 
 11.  The Cash Flow Statement has been prepared under the Indirect
 Method set out in Accounting Standard (AS-3) issued by The Institute
 of Chartered Accountants of India.
 
 12.  Previous years figures have been regrouped to make them comparable
 with current year figures wherever necessary.