Professional Documents
Culture Documents
ACCOUNTING-1
Assignment-1
Abstract
To read and analyze companys (SRF Ltd.) annual reports and attempt the given
problems to seek solution
To: Himanshu
Mr. ParagPatel
Rijwani
himanshupatel_15@nirmauni.ac.in
Section D, Roll No - 151419
Chemicals
SRFs Chemicals Business caters to diverse applications
across industries. Starting with the refrigerant production facility
in Bhiwadi near New Delhi in 1989, SRF has grown to become a
highly backward integrated producer of refrigerants, chlorinated
solvents and fluorospecialities.
As a proud winner of the 2012 Deming Prize, the Chemicals
Business of SRF Ltd. caters to the exacting quality requirements
of the Automobile, Refrigerator, Air-conditioner, Laundry,
Pharmaceutical and Agrochemical industries amongst others.
Packaging Films
Packaging Films Business has emerged as one of the most
preferred Packaging arena. Engaged in manufacturing of Biaxially Oriented Poly-Ethylene Terephthalate
(BOPET)
Films
commonly
known
as
Polyester
(PET)
Films.
During a span of ten years, Packaging Films Business has crafted
a significant presence in EU, Americas, Middle East, ANZ, Russia
& CIS, Africa, West Asia & South Asian regions and continues to
expand its list of highly satisfied clientele across the world.
Engineering Plastics
Established in 1979, the Engineering Plastics Business of
SRF enjoys the status of being the first company in India to start
polymer
compounding.
Initially focused on manufacturing and compounding of
Polyamide 6 resin, today the business offers several engineered
compounds under brands TUFNYL, TUFBET, TUFPC.
Read the Contents page. Mark the items that relate to financial statements as FS
(Financial Statement) and the rest as NFS (Non-Financial Statement). What
information does the company provide in items that you have marked as NFS? Is
this information useful? How? Who is the intended audience? Will they be able to
understand the information? Give highlights of ANY THREE major NFS items.
:
:
:
NFS
NFS
NFS
NFS
:
NFS
:
:
FS
FS
NFS
The 44th Annual General Meeting of SRF Limited will be held on Thursday,
the 6 August 2015 at 3.30 p.m. at the LaxmipatSinghania Auditorium, PHD
House, 4/2 Siri Institutional Area, August Kranti Marg, New Delhi.
The following items were to be discussed in the Annual General Meeting.
Ordinary Business
To receive, consider and adopt the standalone and consolidated
audited financial statements of the Company for the financial year
ended 31 March 2015, the Reports of the Auditors and Board of
Directors thereon.
To appoint a Director in place of Mr.Arun Bharat Ram (DIN
00694766), who retires by rotation and being eligible, offers himself
for re-election.
To ratify appointment of auditors of the Company as approved by
the members at the Forty Third Annual General Meeting.
Special Business
Appointment of DrMeenakshiGopinathas a Director, liable to retire
by rotation.
DrMeenakshiGopinath ,who was appointed as an additional Director
of the Company with effect from 28 October 2014 be and is hereby
appointed as aDirector of the Company liable to retire by rotation.
Appointment and
Director of CSR.
Remuneration
of
DrMeenakshiGopinath)as
Functions
DrMeenakshiGopinath shall be designated as Director(CSR). She
shall
be
responsible
for
planning,
guiding
andensuring
implementation of CSR projects of the Company inaccordance with
the CSR Policy approved by the Board andsuch other responsibilities
Fee
She will be entitled to consolidated fees of ` 1 lakh permonth
(subject to deduction of applicable taxes) plus servicetax. She will
also be entitled to a Company maintained car.
Sitting Fees
DrMeenakshiGopinath would be entitled to sitting feesfor attending
the Board meetings and/or meetings ofother Committees on which
she is nominated except theCorporate Social Responsibility
Committee.
Termination
The services of DrMeenakshiGopinath as Director (CSR) may be
terminated by either party giving to the other three calendar
months notice in writing. RESOLVED FURTHER THAT subject to the
overalllimit of remuneration payable to all the Directors (other than
Executive Directors) taken together, the aforesaid remuneration
payable to DrMeenakshiGopinath shall be within an overall ceiling of
1% of the net profits of the Company computed in the manner laid
down in Section 197 of the Companies Act, 2013.
To consider and if thought fit, to pass with or withoutmodification(s),
the following resolution as an OrdinaryResolution:
Re-appointment of Mr Ashish Bharat Ram (DIN 00671567) as Managing
Director:
With tenure of Five years with effect from 23 May 2015.
Functions
Subject to the direction, control and superintendence ofthe Board
of Directors, Mr. Ashish Bharat Ram shall havethe overall
responsibility for looking after the day to daymanagement of the
Company.
Remuneration
Minimum Remuneration
In the event of absence or inadequacy of profits in anyfinancial
year, the remuneration payable to Mr. Ashish BharatRam shall be
decided by the Nomination and RemunerationCommittee.
Termination
The appointment of Mr. Ashish Bharat Ram as ManagingDirector
may be terminated by either party giving to the otherthree
calendar months notice in writing.
compensation in accordance with the provisions of theCompanies
Act, 2013 or any statutory amendment or reenactment
To
consider
and
if
withoutmodification(s),
SpecialResolution:
thought
fit,
to
pass
with
the
following
resolution
as
or
a
Indian Subsidiaries
SRF Transnational Holdings Limited India
SRF Properties Limited India
SRF Holiday Home Limited India
SRF Energy Limited India
SRF Fluorochemicals Limited
Foreign Subsidiaries
SRF Fluor Private Limited^ Mauritius
SRF Global BV Netherlands
SRF Overseas Limited
Government Body
Share Holders
For example, In notes it is given that the company has paid two interim
dividends on share, 10 per share, 5 at each time amounting into INR 68.05
Crore (Inclusive of Taxes). This information is useful when we prepare
Balance Sheet.
List the main items on which the auditors report. Give details
of three items that significantly affect the financial
statements.
o
o
o
o
o
Here are three items that significantly affect the financial statements.
Following are the instances of delay in transferringamounts, required to be
transferred, to the InvestorEducation and Protection Fund by the Company
Refer Note 31 (b) to the financial statements:
Nature
of Amount (INR in Date by which Date of Deposit
Amounts
Lakhs)
amount
should
have
been
credited to fund
Matured
0.15
20-12-2012
23-06-2014
Unclaimed Fixed
Deposits
Interest
on 0.02
20-12-2012
23-06-2014
Above
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The following matters, which have been excluded from the above table, have
been decided in favor of the aforesaid entities but the
Department has preferred appeals at higher levels. The details are given
below
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Sales of Product
Export incentives
o Dividend/Profit on
investment
o Exchange
currency
fluctuation
o Interest Income
Current
Year
Income (in
lakh INR)
357020.8
0
1624.57
4735.64
Previous Year
Income
( in lakh INR)
% change on
Previous Year
340210.26
4.95%
126.70
2471.42
1182.22%
91.62%
REVENUE RECOGNITION
Sale of goods is recognized, net of returns and tradediscounts on the
transfer of significant risks and rewardsof ownership to the buyer which
generally coincideswith the dispatch of goods to customers. Gross salesare
inclusive of excise duty and net of value added tax /sales tax.
Other income includes interest income which isaccounted on accrual
basis, dividend income isaccounted for when the right to receive is
established.
Identify the sources of companys gains and other nonoperating income. What is the proportion of these items in
relation to the total income and Net Profit after Tax?
Source of companys gain are
o Sales of Goods
o Scrap sales
o Export incentives
Non-operating income source
o Dividend on current investments
o Profit on sale of current investments
o Profit on sale of investment in subsidiaries
o Dividend on non-current investments
o Provision / Liabilities no longer required written back
o Provision for long term investments no longer required
o Profit on sale of fixed assets
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What are the major items of expenses? How these items have
changed in percentage terms as compared to the previous
financial year?
Major item of expenses are Cost of materials consumed, Employee
benefit expense, other expenses such as Power and Fuel expense,
Repairing and maintenance expense, Freight, Travel expense etc.
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EMPLOYEE BENEFITS
Companys contributions paid / payable during theyear to provident
fund administered through RegionalProvident Fund Commissioner,
Superannuation Fundand Employees State Insurance Corporation
arerecognized in the Statement of Profit and Loss.
Provision for gratuity, compensated absences, providentfund for
certain category of employees administeredthrough a recognized provident
fund trust and long termretention pay are determined on an actuarial basis
at theend of the year and charged to Statement of Profit and Loss for each
year.
INVENTORIES
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How does the company measure its fixed assets? What is the
amount of fixed assets purchased during the year? What is its
proportion in the total assets? Is this proportion significant?
Why?
77370.91 lakh INR purchased of new assets were bought. Its proportion
to the total assets (486790.06) is 15.89%.
Of course the proportion is important as it shows the trends towards
reinvestment in the assets for the company.
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The proportion change in cash to the total assets compared to previous year,
it is lower by 0.33% current year.
What percentage of the companys receivables is due for more
than six months? What is the change in this proportion as
compared to the previous year?
Particulars
As on 31st As on 31st
March,2015
March,2014
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Receivables
61065.42
69149.11
> 6 Months
Total Assets
595396.23
551855.45
Prop.
10.26%
12.53%
Receivables
to
Total
Assets
Proportion of the companys receivables to the Total assets of the respective
years over the year has gone down by approx. 2.2%.
What is the proportion of Inventories in the total assets? What
is the change in this proportion as compared to the previous
year?
Particulars
As
on
31st As
on
31st Change (A-B)
March,2015 (A)
March,2014
(B)
Inventories (X)
63758.78
63116.13
Total Assets (Y)
486790.06
446519.94
% (X*100/Y)
13.10%
14.14%
-1.04
Proportion of Inventories in total assets over the year has not changed
significantly though there was decrease of 1% approx.
How does company measure its Inventories? Is there any
change in the inventory measurement as compared to the
previous year? If yes, give details.
Company measures Inventories at cost or net realizablevalue,
whichever is lower. The basis of determining the cost for various
categories of inventory are as follows:
Particulars
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As
31st
on As
on
March,2014
March,20
15 (A)
raw materials (X)
196206.2
2
Net sales revenues 357020.8
(Y)
0
% (X*100/Y)
54.96%
(B)
201683.79
-5477.57
340210.26
16810.54
59.28%
-4.32%
Particulars
current liabilities
total liabilities
% (X*100/Y)
As
on
31st As
on
March,2015 (A)
March,2014
(B)
96538.19
115355.06
486790.06
446519.94
19.83%
25.83%
-6.00%
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long
liabilities (X)
total liabilities (Y) 486790.06
% (X*100/Y)
22.47%
446519.94
18.91%
3.56%
22
What is the face value of the equity share? Has the company
issued any shares for services or non-cash assets? If yes, give
details.
The face value of the equity share of the company is 10 INR per share.
The company has not issued any equity shares for the services or noncash assets.
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How much is the basic and Diluted EPS and dividend per share?
Basic and Diluted EPS were 53.59 INR. Interim Dividend per share was
declared 10 INR per share although annual dividend was not declared.
Remuneration of Directors
Interim Dividend Payment 5per share each (50 per cent) onthe paid up capital of
the Company absorbing ` 68.04 croresapprox. (inclusive of tax) were paid on 3 September
2014and 24 February 2015 respectively.
Corporate Governance
Certificate of the auditors of your Company regarding complianceof the
conditions of corporate governance as stipulated inClause 49 of the Listing
Agreement with the stock exchanges isattached to the report as Annexure
IV.In compliance with the requirements of Clause 49(V), a certificatefrom
Managing Director and the President & Chief FinancialOfficer was placed
before the Board.All Board members and Corporate Leadership Team (CLT)
have
affirmed compliance with the Code of Conduct for Board andSenior
Management Personnel. A declaration to this effect dulysigned by the
Managing Director is enclosed as a part of the
Corporate Governance Report.Annual Report on CSR for the financial year ended 31
March, 2015
1) A brief outline of the Companys CSR Policy, including overview of projects
or programs proposed to be undertaken and areference to the web-link to
the CSR Policy and projects or programs.
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As per the requirement of Section 135, Companies Act, 2013, the Company
had laid down a CSR Policy which has identifiedprojects as per the Schedule
VII of The Act in the following areas : Promotion of Education: Improving Quality of Education and Developing
School infrastructure of Govt. Schools;
Employment enhancing vocational skills : Focusing on imparting
appropriate skills as per the market and industry needs andproviding a
platform to the youth trained to be gainfully self-employed or linking them
with potential employers to increasetheir employability and livelihood;
Promoting gender equality and empowering women :Focusing on providing
special skill trainings and confidence building soas to make them self-reliant
and improve their employability and income;
Preventive Healthcare: Regular check-ups and diagnosis for prevalent
ailments in the community present in and around plantlocations of SRF;
Ensuring Environment Sustainability: Conversion of barren undulated lands
into cultivable lands, promoting alternativeplantation, building check dams,
rainwater harvesting and water conservation to prevent depletion of
underground andsurface water sources; and
Promoting Rural Sports: Coaching for sports such as Kho-Kho, Kabadi etc.
and to provide a platform where athletes cancompete at various level and
proceed to state and national level.
2) The Composition of the CSR Committee
DrMeenakshiGopinath, Chairperson
Mr.Kartik Bharat Ram, Deputy Managing Director
Mr. L Lakshman, Independent Director
3) Average Net Profit of SRF Ltd for last three financial years
2013-14 :` 272.22 crores
2012-13 :` 329.62 crores
2011-12 :` 554.74 crores
Average Net Profit :` 385.53 crores
2% of Avg. Net Profit :` 771 lakh
4) Prescribed CSR Expenditure - ` 771 lakh
5) Details of CSR Spent during the Financial Year
a. Total Amount to be spent for the financial year - ` 771 lakh
b. Amount Unspent - ` 329.05 lakh6) Reason for not spending the two
percent of the average net profit of the last three financial years or any part
thereofThe Company and SRF Foundation (the implementation agency) were
unable to fully incur the CSR expenditure due to the factthat this was the
first year of CSR implementation and this required considerable time in
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Engineering Plastics
Chemicals Technology Group
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Reference
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www.srf.com
www.wikipedia.org
Annual report for the year 2014-15
THANK YOU
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