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SENSEX NIFTY India | Notes to Account > Power - Transmission & Equipment > Notes to Account from Jyoti Structures - BSE: 513250, NSE: JYOTISTRUC

Jyoti Structures

BSE: 513250|NSE: JYOTISTRUC|ISIN: INE197A01024|SECTOR: Power - Transmission & Equipment
May 25, 15:41
-0.01 (-0.23%)
VOLUME 113,342
May 25, 15:41
0.15 (3.61%)
VOLUME 60,115
Mar 14
Notes to Accounts Year End : Mar '15
1.  Outstanding Contracts - Capital Account:
 Estimated amount of contracts remaining to be executed on capital
 account and not provided for (Net of advances) are Rs. 7.14 Lacs (P.Y. Rs.
 11.28 Lacs ). Advances paid Rs. 5.93 Lacs (P.Y. Rs.. 24.32 Lacs).
 2. The gross block of fixed asset includes Rs. 83.62 Lacs (P.Y. Rs. 83.62
 Lacs) on account of revaluation of fixed assets carried out by the
 Company in the year 1993-94. Consequent to the said revaluation, there
 is an additional charge of Rs. 2.42 Lacs (P.Y.  Rs. 2.42 Lacs) on account
 of depreciation and an equivalent amount has been withdrawn from the
 revaluation reserve and credited to Statement of Profit and Loss. This
 has no impact on the loss for the year.
 3.  The Company has a process whereby periodically all long term
 contracts are assessed for material foreseeable losses. At the year
 end, the Company has reviewed and ensured that adequate provision as
 required under any law/ accounting standards for material foreseeable
 losses on such long term contracts has been made in the books of
 accounts. The Company has not entered into a derivative contract during
 the year.
 4.  The Company has invested an amount of USD 129.90 Lacs equivalent
 to Rs. 6,000.65 Lacs in its subsidiary company namely, Jyoti
 International Inc. Further, as at 31st March, 2015, balance of loans
 and advances outstanding was of Rs. 6,712.77 lacs to Jyoti International
 Inc. and Rs. 3,148.57 lacs to Jyoti Americas LLC, a wholly owned
 subsidiary of Jyoti International Inc. That company maintains its
 accounts on financial year basis. The company has incurred total loss of
 USD 219.53 Lacs equivalent to Rs. 13,763.34 Lacs (P.Y. Loss of USD 133.01
 Lacs equivalent to Rs. 7,579.41 Lacs) during the year. Total accumulated
 losses as on 31st March 2015 are USD 420.67 Lacs (P.Y. USD 201.14
 Lacs). However, based on the orders in hand and the business outlook of
 the company, the management is of the opinion that these accumulated
 losses are temporary in nature and will be recovered in the next few
 years. Therefore, no provision for diminution in the value of the said
 investment or no provision for other outstanding amounts is made as the
 management is confident of turning around the business of that company
 in the near future.
 5.  Lauren Jyoti Private Ltd. is a joint venture company (JVC) between
 Lauren Engineers Constructors Inc. (Lauren) and Jyoti Structures
 Limited (JSL) with equity participation of Rs. 500 Lacs by each partner
 and with technical assistance, support and know-how to be provided by
 Lauren and pre-qualification credentials by the Company for EPC
 Contracts. As on 31st March 2015, the trade receivable of the Company
 include amount of Rs. 7,045.80 Lacs outstanding from JVC. Further an
 amount of Rs. 5,507.00 Lacs was paid by the Company on account of
 encashment of Bank guarantee by a customer of JVC, which amount is
 debited to JVC. The other outstanding from JVC are Rs. 830.30 Lacs for
 support services provided by the Company. Due to differences and
 disputes arising between the partners during the execution of 50 MW
 Solar Thermal Power Plant EPC Contract awarded by Godavari Green Energy
 Limited, the financial statements of JVC have not been adopted after
 31st March 2013. The Company has referred the dispute to arbitration
 and the management is reasonably confident of recovering the amount.
 6.  The Company has invested an amount of Rs. 419 in the equity share
 capital of Jyoti Structures Africa (Pty) limited (JS Africa), a
 subsidiary company. As on 31st March, 2015, the Company has also
 advanced loan of Rs. 3,581.91 lacs to JS Africa and the outstanding
 credit to that company is Rs. 3,277.65 lacs. Though the net worth of the
 subsidiary has been eroded, the Company has not provided for diminution
 in value of investment of Rs. 419 and no provision is made against
 outstanding loans and dues of said company. Considering the business
 outlook of the subsidiary Company, the management is of the opinion
 that these accumulated losses of that company are temporary in nature
 and will be recovered in the near future.
 7.  During the year, the company has paid managerial remuneration
 amounting to Rs. 43.04 lacs which is in excess of the provisions of
 section 197 of the Companies Act, 2013 read with Part II of Schedule V.
 The Company is in the process of seeking shareholders'' approval for
 waiver of the same, subject to approval of Central Government.
 8.  Foreign Currency exposures that are not hedged by derivative
 instruments as on 31st March, 2015 amount to Rs. 87,451.53 Lacs (P.Y. Rs.
 47,496.99 Lacs)
 9.  Disclosures for operating leases under Accounting Standard 19 
 a) Disclosures in respect of the agreements entered into after 1st
 April, 2001 for taking on leave and license/under operating leases the
 residential/office premises and warehouses, including furniture fittings
 therein as applicable and machinery, are given below:
 The agreements provide for early termination by either party with a
 notice period which varies from fifteen days to three months and they
 contain a provision for their renewal.
 10.  Related Party Disclosures:
 Related party disclosures as required by Accounting Standard 18,
 Related Party Disclosures, Relationships (during the year)
 (a) Subsidiary of the Company:
 i) Jyoti Energy Ltd.
 ii) JSL Corporate Services Ltd.
 iii) Jyoti Structures Africa (Pty) Ltd.
 iv) Jyoti International Inc.
 v) Jyoti Americas LLC
 vi) Jyoti Structures Canada Ltd.
 vii) Jyoti Structures FZE
 viii) Jyoti Structures Namibia (Pty) Ltd.
 ix) Jyoti Structures Nigeria Ltd.
 x) Jyoti Structures Kenya Ltd.
 (b) Joint Venture:
 i) Gulf Jyoti International LLC ii) Lauren Jyoti Pvt. Ltd.
 (c) Key Management Personnel:
 i) Mr. Ashok Goyal ii) Mr. Santosh Nayak iii) M r. K. R. Thakur
 11.  Employees Stock Option Scheme:
 Under Jyoti Structures Limited Employees Stock Option Scheme 2005 (ESOS
 2005) as amended, the Company is authorised to issue upto 5,00,000
 (Five Lacs) stoc k options convertible into 25,00,000 (Twenty Five
 Lacs) Equity Shares of Rs. 2/- each to employees. A Compensation
 Committee has been constituted by the Board of Directors of the Company
 to administer the Scheme.
 Each option is to be converted into 5 equity shares of Rs. 2/- each at an
 exercise price of Rs. 17/- per equity Share (being the exercise price
 adjusted after split of face value from Rs. 10/- to Rs. 2/-). Under the
 scheme, 30% of the options vest at the end of one year from the date of
 grant of options, 30% at the end of second year from the date of grant
 of options and the balance 40% at the end of third year from the date
 of grant of options.
 The amount of Rs. 20.92 Lacs (P.Y. Rs. 56.15 Lacs) debited to Employee
 Compensation Expense  ESOS account, represents the proportionate cost
 for the year and has been credited to the revenue account.
 The amount of Rs. 341.75 Lacs (P.Y. Rs. 374.20 Lacs) in Employee Stock
 Option outstanding account, represents discounts on the options
 12.  Engineering Procurement Construction (EPC) Contracts provide for
 levy of liquidity damages (LD) to the extent of 10% of the contract
 value for delay in execution of the contracts. As a trade practice, on
 completion of the contracts such delay is generally condoned by
 granting time extension. It is not possible to ascertain the quantum of
 the LD for the projects where execution is delayed, as the proposals
 for time extension are pending with the customers and in the past, time
 extensions have been granted in similar circumstances.
 13.  Consequent to encashment of Bank Guarantee by Power Grid
 Corporation of India Ltd. in April 2014, for Tangla-Kokrajhar-
 Barabisa, Assam project, the Company has initiated dispute resolution,
 in accordance with the terms of the contract.
 14.  Jaypee Power Ventures Ltd. (JPVNL) wrongfully encashed the
 performance bank guarantees amounting to Rs.. 1,773.22 lacs in July 2014,
 though the company had completed the contract and the line was charged.
 The Company has initiated dispute resolution, in accordance with the
 terms of the contract.
 15.  Maharashtra State electricity Corporation Ltd (MSETCL) has
 terminated the contract and encashed the performance guarantees
 amounting to Rs. 1,987.48 Lacs in July 2014 as the execution of contract
 was delayed due to Right of Way, availability of land, reasons being
 beyond the control of the Company. The Company has been advised to
 initiate dispute resolution in terms of the contract.
 16.  MP Madhya Kshetra Vidut Vitaran Company Ltd. has terminated part
 of the contract and encashed the performance guarantees amounting to Rs.
 2,025.81 Lacs in April 2015 as the execution of contract was delayed
 due to reasons beyond the control of the Company. The Company has been
 advised to initiate dispute resolution in terms of the contract. The
 Company has made provisions in the Statement of Profit and Loss although
 the event has occurred after balance sheet date.
 17.  Trade Payable includes dues to micro and small enterprises to whom
 the Company owes amounts outstanding for more than 45 days. The
 information regarding micro and small enterprises has been determined
 to the extent such parties have been identified on the basis of
 information available with the Company. This has been relied upon by
 the auditors.
 18.  The lenders of the Company have restructured the debt under RBI
 guidelines on Joint Lender Forum and Corrective Action Plan.
 Restructuring contours:
 1.  The cut-off date (COD) identified, for the purpose of determining
 the eligible debts to be restructured under the Restructuring Scheme is
 April 1, 2014.
 2.  Rescheduling of due amount of term loans, working capital loans and
 interest thereon and additional sanction of cash credit facility,
 non-fund based working capital and term loan.
 3.  Moratorium for principle repayment of term loan for 18 months from
 COD i.e. till September 30, 2015.
 4.  Reduction in rates of interest on term loans @ 12% p.a.
 5.  Interest to be funded on term loan for 12 months from COD i.e. till
 March 31, 2015.
 6.  Personal guarantees of promoters of the Company.
 7.  Pledge of the unencumbered shares of the promoters of the Company.
 19.  In August 2013, Jyoti Americas LLC (subsidiary of the Jyoti
 International Inc.) has issued subordinated debt of ,30,00,000 and
 preferred stock Series A of ,00,00,000. In April 2014, the Company
 issued additional 47 shares of Series A preferred stock, at ,00,000
 per share, for additional gross proceeds of ,88,00,000. Cumulative
 dividends accrues on this preferred stock of Series A accrues on a
 daily basis at the rate of 0.01% per year on the original purchase
 price, per share.
 Jyoti Americas LLC has a contingent liability of ,700,000 for above
 mentioned preferred stock variable return along with its accretion of $
 46,16,444 and ,29,000 for the years ended March 31, 2015 and 2014,
 As per preferred stock agreement, the Company and Jyoti Structures
 Limited, the parent company, plan to settle the variable return due on
 August 28, 2016 through the issuance of common stock of Jyoti
 Structures Limited. Accordingly, the Company has not recorded an
 obligation of $ 3,47,00,000 related to the preferred stock variable
 return as of March 31, 2015.
 20.  The number of shares of Jyoti Structures Ltd. to be issued on
 settlement of the preference stock as referred to in Note No.  31 (31)
 on the Maturity on August 28, 2016, cannot be ascertained and
 therefore, the dilutive effect of those shares on the Diluted EPS of
 the Company has not been considered.
 21.  Corporate Social Responsibility (CSR)
 During the year under report the company has constructed roads in 13
 villages (in 10 districts) across India at the cost Rs. 193.71 Lacs.
 Construction of roads resulted in saving of travel time and ease of
 transportation to Villagers.
 22.  Pursuant to the enactment of Companies Act, 2013 effective 1st
 April, 2014, the Company has reviewed the estimated useful life of its
 Fixed Assets generally in accordance with that provided in Schedule II
 of the Act. The applicable rates of depreciation are also accordingly
 altered. As a result amount of Rs. 431.47 Lacs were reduced from the
 surplus in the statement of Profit and loss and the depreciation charged
 for the year ended 31st March 2015 is higher by Rs. 624.90 Lacs.
 23.  Previous year''s figures have been reworked, regrouped, rearranged
 and reclassified wherever necessary.
Source : Dion Global Solutions Limited
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