1. Employee Benefits
The Company has, with effect from January 1, 2007, adopted Accounting
Standard 15 (Revised) [AS- 15(Revised)] on employee Benefits.
Consequently, the additional liability for employee benefits based on
actuarial valuation as at January 1, 2007 as per AS-15 (Revised),
amounting to Rs. 89 (000s) has been adjusted against General Reserve
as at January 1, 2007.
(C) The liability for leave encashment as at the year end is Rs.
In accordance with AS-15 (Revised), the Company has provided leave
encashment on the basis of actuarial valuation at the year-end as
against the earlier policy of providing leave encashment based on
unavailed leave balance to the credit of employees at the year-end. Had
the Company provided leave encashment on the earlier basis, loss for
the year would have been higher by Rs. 200 (000).
This being the first year of implementation of revised AS-15 (Revised),
previous year figures have not been given.
2. The Company is eligible to claim refund of excise/ customs duty paid
on material sold pursuant to contracts entered with certain customers.
As at December 31, 2007, benefit receivable on deemed exports includes
Rs. 31,032 (000s) for which the Company has applied/is in process of
filing application with government authorities for claiming such
refunds. However, eventual recovery of the aforesaid refund is
dependent on completion of certain formalities and submission of
a) Provision for Indirect Tax Matters represents estimates made for
probable liabilities arising out of pending disputes/ litigations with
various authorities. The timing of the outflow with regard to the said
matters depends on exhaustion of remedies available to the Company
under the law and hence the Company is not able to reasonably ascertain
the timing of cash outflow.
b) Warranty covers the expenses related to repairing and maintenance of
detectors and cylinders sold as per the terms of the contract entered
into by the Company with its Customers. Future Cash Flows in respect of
the same is expected to occur over the period of warranty.
On consideration of prudence, the deferred tax asset is recognised only
to the extent of deferred tax liability.
(b) The Company is yet to commence an independent review for assessing
compliance with Transfer pricing Rules, 2001 issued by the Central
Board of Direct Taxes, India. On the basis of self assessment of the
operations during the year, the Management does not expect any
deviation from the requirements of the aforesaid Transfer Pricing
3. Segment Information:
In accordance with Accounting Standard 17 Segment Reporting, the
Company has determined its business segment as manufacture, erection
and commissioning of Fire Protection System and supply of related
components and spare parts. There are no other primary reportable
segments. Accordingly, the segment revenue, segment result, total
carrying amount of segment assets, total carrying amount of segment
liabilities, total cost incurred to acquire segment assets, total
amount of charge for depreciation during the year are as reflected in
the Financial Statements as of and for the year ended December 31,2007.
The performance of the Company is mainly driven by the sales made
locally and hence, no separate geographical segment is identified.
4. Related Party Disclosure:
Related Party Disclosures as required by Accounting Standard 18,
Related Party Disclosures are given below:
I Ultimate Holding Company
United Technologies Corporation Inc., U.S.A.
II Enterprises having control over the Company
Kidde Pic, U.K.
Kidde International Limited, U.K.
III Enterprises under common control
Kidde Fire Fighting
Chemetron Fire Systems
Kidde Italia, S.p.a.
Kidde Fenewal, Inc.
Detector Electronics Corporation.
Kidde Fire Protection Limited
Autronica Fire and Security AS, Norway
Kidde Denmark A/S (formerly Ginge-Kerr Denmark A/S)
Kidde Deugra Brandschutz System-GmBH
Kidde Asia Pte Limited
Kidde Finance Limited, U.K.
Kidde Middle East
Carrier AirConditioning & Refrigeration Limited
Chubb Hongkong Limited
Chubb Alba Control Systems Limited
Chubb Protection Corporation
Chubb Singapore Pte Limited
IV Key Management Personnel
Mr. Nikhil Pathak - Managing Director (w.e.f. November 15, 2006) Mr.
Devendra Mehta - Finance Director (w.e.f. November 8, 2006)
5. In view of the erosion of net worth of the Company arising from
operating losses, Kidde International Limited, U. K., the holding
company, has informed the Company of its intention to continue to
support the operations of the Company and accordingly, the financial
statements have been prepared on going concern basis.
6. These accounts have not been authenticated.by whole-time company
secretary as the Company has not appointed a new whole-time company
7. Sundry Creditors as at December 31, 2007 include amount of Rs.
5,110 (000s) [Previous Year: Rs. 4,289] which are outstanding for more
than three years. The Management has initiated the process of
reconciliation and no material adjustments are anticipated on
completion of reconciliation by the Management.
8. There are no delays in payment to Micro and Small enterprises as
required to be disclosed under the Micro, Small and medium Enterprises
Development Act, 2006.
The above information and that given in Schedule -10 Current
liabilities and provision regarding Micro and Small Enterprises has
been determined to the extent to such parties have been identified on
the basis of information available with the Company. This has been
relied upon by Auditors.
9. Disclosures pursuant to Accounting Standard (AS) 7 (Revised)
i) Contract Revenue recognised for the year ended December 31, 2007 is
Rs. 636,697 (000s) [Previous Year Rs, 454,194 (000s)].
ii) Aggregate amount of contract costs incurred and recognised profits
(less recognised losses) up to December 31, 2007 is Rs. 1,666,098
(000s) [Previous Year Rs. 1,487,964 (000s)].
iii) Amount of customer advance outstanding for Contracts in progress
as at December 31, 2007 is Rs. 32,946 (000s) [Previous Year Rs. 26,491
iv) Retention amounts receivable from customers for contracts in
progress as at December 31, 2007 is Rs. 144,357 (000s) [Previous Year
Rs. 94,212 (000s)].
10. Previous years figures have been regrouped and rearranged,
11. Refer Annexure for additional information pursuant to Part IV of
Schedule to the Act.