1.  Background
 
 Morganite Crucible (India) Limited (''the Company'') was incorporated on
 13 January 1986. The Company is engaged in the business of
 manufacturing and selling of silicon carbide and clay graphite
 crucibles and its accessories.
 
 2.  Capital commitments
 
 Estimated amount of contracts remaining to be executed on capital
 account and not provided for Rs.4,025,000 (2010: Rs.6,176,056).
 
 3.  Contingent liabilities
 
 i) Bank guarantee aggregating Rs. Nil (2010:Rs. 200,000) issued by the
 bank on behalf of the Company in favour of the Panalpina World
 Transport Private Limited for purchase of Material from Thermal Ceramic
 U.K. Limited.
 
 ii) Bonds aggregating Rs.10,000,000 (2010: Rs.10,000,000) in favour of
 the President of India endorsed through Deputy Commissioner of Customs
 for import of goods.
 
 iii) A suit has been filed by Mr. Suresh Borade, past employee of the
 Company, on account of his disputed resignation from the Company. The
 Honourable Gujarat High Court has ordered to pay Rs.540 per month till
 the final disposal of appeal pending for reinstatement with back wages.
 The Company is presently paying the above mentioned Rs.540 per month to
 the said employee. The amount of liability that may arise in future on
 account of reinstatement with back wages is not ascertainable.
 
 iv) Claims by employees towards unfair labour practices under Section
 28 read with items 1(a), (b), (c), 2 (b), 3, 4(a), (e) and (f) of
 Schedule II and items 5, 6, 9 and 10 of Schedule IV of the Maharashtra
 Recognition of Trade Unions and Prevention of Unfair Labour Practices
 Act, 1971 for which amounts are not ascertainable.
 
 v) Disputed employees'' state insurance demand aggregating Rs. 52,498
 against which the Company has preferred appeals.
 
 Experience adjustment is on account of attrition in the number of
 employees as compared to the previous year and change in actuarial
 assumptions.
 
 The estimates of future salary increases, considered in actuarial
 valuation, take into account inflation, seniority, promotion and other
 relevant factors, such as supply and demand and the employment market.
 
 G.  Percentage of each category of Plan Assets to total Fair Value of
 Plan Assets as at 31 March 2011.
 
 The Plan Assets are administered by Life Insurance Corporation of India
 (“LIC”) as per Investment Pattern stipulated for Pension and Group
 Schemes Fund by Insurance and Regulatory Development Authority
 regulations.
 
 The discount rate is based on the prevailing market yields on Indian
 government securities as at the balance sheet date for the estimated
 term of obligation.
 
 4.  Segment reporting
 
 Primary segment:
 
 In accordance with the requirements of Accounting Standard 17 –
 “Segment Reporting”, the Company has determined its business segment as
 crucibles. Since 100% of the Company''s business is from crucibles,
 there are no other primary reportable segments. Thus the segment
 revenue, segment result, total carrying amount of segment assets, total
 carrying amount of segment liabilities, total cost incurred to acquire
 segments assets, the total amount of charge for depreciation and
 amortisation during the year are all as reflected in the financial
 statements for the year ended 31 March 2011 and as on that date.
 
 5.  Related party disclosure
 
 List of related parties
 
 i.  Parties (where control exists)
 
 The Morgan Crucible Company Plc, U.K. - Ultimate holding company
 
 ii.  Investing associates
 
 Morganite Crucible Limited (holds 38.50% of issued, subscribed and paid
 up capital) Morgan Terreassen BV (holds 36.50% of issued, subscribed
 and paid up capital)
 
 iii.  Other related Parties where transactions have taken place during
 the year
 
 Subsidiary company
 
 Diamond Crucible Company Limited Fellow subsidiary companies
 
 Morganite Crucible Inc., USA
 
 Morgan Molten Metal Systems GMBG Germany
 
 Morgan Thermic SAS, France
 
 Morgan Molten Metal System (Suzhou) Co. Ltd., China
 
 Morgan Karbon Grafit Sanayi AS Turkey
 
 Thermal Ceramics UK
 
 Morganite Brazil LtdA
 
 Morgan Thermal Ceramics - Shanghai
 
 iv.  Key Management Personnel
 
 - Mr. Vijay Sabarwal – CEO and Wholetime director (upto 29 January
 2011)
 
 - Mr. Ashish Mehrotra – Director sales and marketing
 
 - Mr. Vinod Mhalsekar – Director operations
 
 - Mr.Hitesh Saiwal – Country head and Wholetime director (from 17 May
 2010)
 
 6.  Dues to Micro, Small and Medium Enterprises
 
 Under Micro, Small, and Medium Enterprises Development Act, 2006
 (MSMED) which came in to force from 2 October, 2006, certain
 disclosures are required to be made relating to Micro, Small and Medium
 enterprises.
 
 7.  Receivables and payables denominated in foreign currency
 
 The Company has entered into derivative contracts to hedge its risk
 associated with foreign currency fluctuations.  However, none of these
 contracts can be co-related on one to one basis against the underlying
 exposure. The Company has outstanding foreign exchange forward
 contracts of GBP 500,000 equivalent to Rs.36,075,000 as at 31 March
 2011.  The Company has revalued these forward contracts as at the year
 end by marking the same to market and recognised a loss of Rs.107,000
 by debiting profit and loss account in compliance with the announcement
 dated 29 March 2008 made by the Institute of Chartered Accountants of
 India (''ICAI'') regarding accounting for derivatives.
 
 8.  Transfer Pricing
 
 The Company''s management is of the opinion that its international
 transactions with related parties are at arms length and that the
 Company is in compliance with the transfer pricing legislation. Based
 on the above, the Company''s management believes that the aforesaid
 legislation will not have any impact on the financial statements,
 particularly on the amount of tax expense and that of the provision for
 taxation.
 
 9.  The Company has availed exemption as applicable to Export Oriented
 companies, granted by notification no. S.O. 301 (E) dated 8 February
 2011 issued by Ministry of Corporate Affairs, Government of India. The
 Board of Directors have given their consent to avail the said exemption
 in their meeting held on 30 March 2011. Hence, the disclosures required
 by paragraphs 3(i)(a), 3(ii)(a), 3(ii)(b) and 3(ii)(d) of Part-II of
 Schedule VI to the Companies Act, 1956 have not been made.
 
 10.  Prior year figures which were audited by a firm of Chartered
 Accountants other than B S R & Co. have been regrouped / rearranged
 wherever necessary to conform to current year''s presentation.