1. Method of Accounting: The Financial Statements have been prepared on
historical cost convention. The Company follows the accrual basis of
accounting. The Financial Statements are prepared in accordance with
the accounting standards specified in the Companies (Accounting
Standards) Rules 2006 notified by the Central Government in terms of
Section 211(3C) of the Companies Act 1956.
2. Revenue Recognition: Sales includes inter-divisional transfers sale
of scrap Sales, Outsource Products, Sales related to Engineering
Procurement and Contract Services, Excise duty Paid, Value Added tax
and Invoices for price escalation as per Contracts with the relevant
customers on accrual basis.
3. Fixed Assets: Fixed Assets are stated at cost less accumulated
depreciation up to the year.
Expenditure incurred on improvement or replacement, which in the
opinion of the management is likely to substantially increase the life
of the assets and future benefits from it is capitalized. Capital
expenditure includes advances for assets under erection/installation
are being grouped under capital work in progress.
4. Depreciation on Fixed Assets: Depreciation on fixed assets is
calculated on a straight-line basis using the rates arrived at based on
the useful lives estimated by the management or those prescribed under
the Schedule XIV to the Companies Act, 1956 whichever is higher. The
Company has used the following rates to provide depreciation on its
5. Expenditure during construction period: All pre- operative project
expenditure (net of income accrued) including interest on borrowings
incurred up to the date of installation is capitalized are added
pro-rata to the cost of fixed assets. Foundation costs are allocated as
certified by management.
6. Investment: Long-term investments are valued at cost. Provision is
made for diminution other than temporary in the value of investments.
a) Inventories of finished goods are valued at
lower of costs or net realizable value inclusive of excise duty. Work
in process (including finished stock pending QC inspection) is valued
at cost representing material labour and apportioned overheads as
certified by the management. Other inventories are valued at cost.
Materials related to Projects under implementation are valued at
b) Cost of work-in-progress and finished goods includes material cost,
labour cost and manufacturing overheads absorbed on the basis of normal
capacity of production.
8. provident Fund and Retirement Benefits: Contribution to Provident
Fund is accounted on actual liability basis. Provision for Gratuity and
Leave Encashment is made based on actuarial valuation.
9. excise Duty: Excise Duty payable on finished goods held as stock in
the works is included in the expenditure and in such stocks as per the
provisions of Section 145 of the Income tax Act 1961.
10. Amortisation: Expenditure on Fire Resistant Low Smoke Project
(FRLS) & High Sensitivity & High Conductivity Conductors (HSHC) have
been amortized over a period of five years. One- fifth portion of the
expenses deferred on Aerial Bunch Cable Project (ABC Project) have been
charged to the revenue for the financial period.
11. Foreign Currency Transactions: The Company has no Branch offices
outside India. The Foreign currency transaction are recorded on initial
recognition in the reporting currency by applying the exchange rate
prevailing at the date of transaction .Any Income or Expense on account
of exchange rate difference is recognized in the Income and Expenditure
12. borrowing Costs: Borrowing costs that are attributable to the
acquisition construction or production of qualifying assets are
capitalized as part of the cost of such assets. A qualifying asset is
one that necessarily takes a substantial period of time to get ready
for its intended use. All other borrowing costs are charged to revenue.
13. Income tax: Provision for Current Income Tax is made after
considering Company''s claims under the Income Tax Act, 1961. This
Liability is calculated at the applicable tax rate or Minimum Alternate
Rate under Section 115JB of the Income Tax Act, 1961 as the case may
14. Deferred tax: Deferred Tax is Calculated at the tax rates and Laws
that have been enacted or substantially enacted as of Balance Sheet
date and is recognized on timing differences that originated in one
period and are capable of reversal in one or more subsequent periods.
Deferred tax assets subject to consideration of prudence are recognized
and carried forward only to the extent that they can be released.
15. Impairment of Assets: The Company has examined carrying cost of its
identified Cash Generating Units (CGU) by comparing present value of
estimated future cash flows from such CGUs in terms of Accounting
Standard-28 on impairment of Assets and in absence of any indication of
being potential impairment of Assets no provision for impairment is
required as assets of none of CGUs are impaired during the financial
year under consideration.
16. uses of estimates: The preparation of financial statement in
conformity with India GAAP requires the management to make judgments
estimates and assumptions that affect the reported amounts of revenues
expenses assets and liabilities and the disclosure of contingent
liabilities at the end of the reporting period. Although these
estimates are based on the management''s best knowledge of current
events and actions uncertainly about these assumptions and estimates
could result in the outcomes requiring a material adjustment to the
carrying amounts of assets or liabilities in future periods.
17. Derivative Contracts: Company as such in the current financial year
has not entered into any such Derivative Contracts.
18. Operating Cycle : Assets and liabilities other than those relating
to long-term contracts (i.e. supply or turnkey contracts) are
classified as current if it is expected to realise or settle within 12
months after the balance sheet date. In case of long-term contracts the
time between acquisition of assets for processing and realisation of
the entire proceeds under the contracts in cash or cash equivalent
exceeds one year. Accordingly for classification of assets and
liabilities related to such contracts as current duration of each
contract is considered as its operating cycle part B Notes to Accounts
1. Contingent Liabilities
(a) Letter of Credit opened Rs.1933.09 Million (Previous Year Rs.
3879.16 Million); materials under all letters of credit have been
received and accounted for as Creditors. Buyer''s credit opened Rs.
74.76 Million (Previous Year Rs. NIL) materials under all Buyer''s
credit have been received and accounted for as Creditors.
(b) Outstanding Inland Bank Guarantees as of March 31 2014 is Rs.
1403.11 Million (Previous Year Rs.1775.00 Million) and outstanding
Foreign Bank Guarantees as of March 312014 is $ 5.51 Million (Previous
(c) Income tax demands being in appeal not provided for Rs. NIL
(previous year Rs Nil).
(d) There are no outstanding Claims against the Company.
(e) Corporate guarantees issued to wholly owned subsidiary - Diamond
Power Transformers Ltd. In favour of Indian Overseas Bank
2. The company has been sanctioned the fund based and non- fund based
working capital facilities of Rs. 1280 Millions from the Axis Bank Ltd.
; Rs. 3500 Million from the Bank of India; Rs. 1590 Million from the
ICICI Bank Ltd.: Rs. 2860 Million from the Bank of Baroda Rs 2100
Million from Allahabad Bank &
Rs 840.7 Millions from Dena Bank Rs. 622 Millions from Indian Overseas
Bank Rs 500 Millions from State Bank of Mysore
& Rs. 1000 Millions against the security of first pari passu charge on
the entire current assets of the company by way of Hypothecation
agreement and the second pari passu charge on the entire fixed assets
of the company.
3. Balance confirmation letters were sent out to various debtors and
creditors. The confirmation of most of the Debtors and creditors is
4. The method of valuation of inventories adopted by the company is in
accordance with the requirements of
Accounting Standard 2 (Valuation of Inventories and as revised from
time to time) issued by the Institute of Chartered Accountants of
5. In the opinion of the Management all the current assets loans and
advances and deposits are realizable at value stated in the ordinary
course of the business which are at least equal to the amount at which
they are stated in the books unless otherwise explicit.
6. Segmental Reporting:
The company is primarily engaged in the manufacture of conductors,
cables and selling out- sourced products and EPC Contracts. As the
company''s manufacturing facilities are inter woven/ inter- mix due to
the nature of its business with the EPC business it is not possible to
directly and specifically attribute or allocate on a reasonable basis
the expenses assets & liabilities in different Segments. The segmental
Sales product wise are as follows:
7. Share Holding in Various Companies :
The Company holds the following shares
(1) 99.60% in its Subsidiary Diamond Power Transformers Ltd.
(2) 100% in its Subsidiary Diamond Power Global Holding Ltd - Dubai
Note: The above Information regarding Small Scale Industrial
undertaking has been determined to the extent such parties has been
identified on the basis of information available with the company. The
same has been relied upon by the Auditors, to confirm names/figures
11. Sales include an amount of Rs Nil (Net of Duty) of inter- unit
Transfer (Previous year Rs NIL).
12. Aggregate directors'' Remuneration is Rs. 59.67 Million (Previous
year Rs. 17.12 Million). The remuneration of directors is as per the
approval accorded by Remuneration Committee shareholders and Central
Government as per the provisions of section 311 read with Schedule XIII
of the Companies Act, 1956.
13. Aggregate Auditor''s Remuneration is fixed at Rs. 1.62 Million
(Previous year Rs 1.62 Million) which includes Rs 1.50 Million as Audit
Fees (Previous year Rs 1.50 Millions).
14. As per Accounting Policy (10) on excise duty the excise duty
payable on finished goods in stocks at works amounting to Rs 7.13
Million (previous year Rs 104.43 Million) has been included in the
expenditure and in such stocks. However the same has no impact on the
profit for the year.
15. There are no amounts due and outstanding to be credited to Investor
Education and Protection Fund.