BAJAJ ELECTRICALS Notes to Accounts

1A ACCOUNTING STANDARDS ISSUED BUT NOT YET EFFECTIVE


Amendments to Ind AS 102, Share-based Payment:


The amendment to Ind AS 102 clarifies the measurement basis for cash-settled share-based payments and the accounting for modifications that change an award from cash-settled to equity-settled. It also introduces an exception to the principles in Ind AS 102 that will require an award to be treated as if it was wholly equity-settled, where an employer is obliged to withhold an amount for the employee’s tax obligation associated with a share-based payment and pay that amount to the tax authority.


The amendment is effective for accounting periods beginning on or after 1 April 2017 and early adoption of the same is not permitted. The Company is evaluating the requirements of the amendment and the impact on the financial statements is being evaluated.


Amendments to Ind AS 7, Cash Flow Statements:


The amendment to Ind AS 7 introduces an additional disclosure that will enable users of financial statements to evaluate changes in liabilities arising from financing activities. This includes changes arising from:


- Cash flows, such as drawdowns and repayments of borrowings; and


- Non-cash changes (i.e. changes in fair values), changes resulting from acquisitions and disposals of subsidiaries/businesses and the effect offoreign exchange differences.


The amendment to Ind AS 7 does not prescribe any specific disclosure format. However, it suggests that a reconciliation between the opening and closing balances in the balance sheet for liabilities arising from financing activities would meet the disclosure requirement. Where a reconciliation is used, the disclosure should provide sufficient information to link items included in the reconciliation to the balance sheet and statement of cash flows. The amendment is effective for accounting periods beginning on or after 1 April 2017 and early adoption of the same is not permitted. The said amendment will not have any impact on the Company’s cash flow, since the amendment requires only additional disclosures.


1B SUMMARY OF CRITICAL ESTIMATES & JUDGEMENTS


The preparation of financial statements requires the use of accounting estimates which, by definition, will seldom equal the actual results. The management also needs to exercise judgment in applying the Company’s accounting policies. This note provides an overview of the areas that involved a higher degree of judgment or complexity, and of items which are more likely to be materially adjusted due to estimates and assumptions turning out to be different than those originally assessed. Detailed information about each of these estimates and judgments is included below.


1 Share based payment


The Company operates a number of equity settled, employee share based compensation plans, under which the Company receives services from employees as consideration for equity shares of the Company. The Company has granted stock options to its employees under the Growth Plan as well as Loyalty Plan.


The fair value of the employee services received in exchange for the grant of the options is determined by reference to the grant date fair value of the options granted. The estimate also includes a forfeiture rate. At the end of each year, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting and service conditions. It recognizes the impact of the revision to original estimates. Such assumptions and judgments may change in the future thereby causing a material adjustment to such expense in profit and loss account.


2 Warranty expenses provision


The Company generally offers 1 to 2 year warranties for its consumer products. Management estimates the related provision for future warranty claims based on historical warranty claim information, as well as recent trends that might suggest that past cost information may differ from future claims. The assumptions made in relation to the current period are consistent with those in the prior years. Factors that could impact the estimated claim information include the success of the Company’s productivity and quality initiatives. Such assumptions and judgments may change in the future thereby causing a material adjustment to such expense in profit and loss account and carrying value of warranty provision in the balance sheet.


3 Provision for trade receivables


The Company makes allowances for doubtful accounts receivable using simplified approach. Significant judgment is used to estimate doubtful accounts. In estimating doubtful accounts historical and anticipated customer performance are considered. Changes in the economy, industry, or specific customer conditions may require adjustments to the allowance for doubtful accounts recorded in the financial statements.


4 Deferred taxes


The company recognizes that net future tax benefit related to deferred income tax assets to the extent that it is probable that the deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred income tax assets requires the company to make significant estimates related to expectations of future taxable income, which may have a scope of causing a material adjustment to the carrying amounts ofassets and liabilities.


5 Revenue from construction contracts


a Recognition of revenue


Revenue from construction contracts is recognized based on the stage of completion determined with reference to the costs incurred on construction contracts and their estimated total costs. The determination of stage of completion requires the Company to estimate the costs incurred till date as a proportion of total costs for the construction contract and such determination of stage of completion involves critical judgment of cost incurred which is attributable to the portion of work completed.


b Provision for foreseeable loss on construction contracts


The company recognizes in full all foreseeable losses which may arise on account of the construction contract immediately in the books of account which goes well with the basic accounting principle of prudence. When it is probable that total contract costs will exceed total contract revenue, the expected losses are recognized as an expense immediately by the company. The amount of such a loss is determined irrespective of whether work has commenced on the contract; the stage of completion of contract activity; or the amount of profits expected to arise on other contracts which are not treated as a single construction contract.


In doing so, the management estimates various aspects like analysis of the total contract revenue, estimated total contract costs on a contract-by-contract basis, analysis of the cumulative progress billings, cumulative total actual costs incurred, contractually agreed timeline set out in the contracts to identify any major delays and/ or cost overruns which might result in profitable contracts becoming loss-making, expected penalty and liquidated damages estimate etc.


Such assumptions and judgments may change in the future thereby causing, either an improvement, whether material or not, to the margin and profitability or recognizing further losses in addition to recognized earlier, in respect of the said construction contracts which were earlier tested for recognition of foreseeable losses.


6 Provision for sales incentive schemes


The Company records provision for sales incentives as a reduction of revenue in its financial statements. The Company offers on-going trade promotion programmes with customers, distribution tie up programmes, festive schemes, retailer bonding schemes, etc. that require the Company to estimate and accrue the expected costs of such programmes.


Estimated sales incentives are calculated and recorded at the time related sales are made and are based primarily on historical rates and consideration of recent promotional activities. The determination of sales incentive liabilities requires the Company to use judgment for estimates that include current and past trade-promotion spending patterns, status of trade-promotional activities and the interpretation of historical spending trends by customer and category. BEL reviews the assumptions and adjust the sales incentives provision at each reporting dates. Our financial statements could be materially impacted if the actual promotion rates fluctuate from the estimated rate.


7 Impairment of investment in joint venture


The Company has invested in its joint venture, Starlite Lighting Limited through equity capital, preference capital and loans and advances. The JV manufactures lighting products and appliances viz CFL bulbs, LED bulbs, water heaters for the Company and also manufactures air conditioning units for Voltas Limited. It has plan to manufacture few more appliances viz Mixers, Room Coolers and LED fittings and luminaries for the Company.


To ascertain the recoverability of the investment made by the Company in the JV, the Company and the JV have jointly prepared a business plan and the impairment testing of the investment made by the Company in the JV is done on the basis of financial projections and future cash flows prepared jointly by the management of both the companies. The achievement of the business plan and the financial projections are based on some assumptions about future business scenario like demand for the products, technology changes, raw material availability, prices of inputs etc.


8 Inventories


The impairment of inventories is done on the basis of its aging, discontinuance of products/model, damage conditions of goods, obsolesce, expected salability. The value is written down at its estimated realizable value less cost to sell.


9 Fair value of financial guarantee given


A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for loss it incurs because a specified debtor fails to make payment that is due in accordance with the original or modified terms of a debt instrument.


For assessment of the fair value of the financial guarantee given to the lenders of our JV Starlite Lighting Limited, the Company has considered the future projections of the JV basis which the loan repayments by JV are considered. Also the loan rate at which the JV would have got the borrowings facility independently is assessed by the Company on the basis of spreads in bps over FIMMDA-PDAI Gilt Curve for valuation of corporate bonds as announced by CRISIL in its monthly valuation matrix as at 31 March 2015


For the financial guarantees given, the Company may be required to make payments to banks / financial institutions only in the event of a default in accordance with the terms of the instrument that is guaranteed. Accordingly, cash shortfalls are the expected payments to reimburse the bankers I financial institutions for a credit loss that may incur less any amounts that the Company expects to receive from the JV or any other party on behalf of JV. At present, the Company has estimated no default of any loans by JV and hence there is no estimated liability by the Company on behalf of the said guarantee given.


10 Contingent liabilities


In the normal course of business, contingent liabilities may arise from litigations and other claims against the Company. Where the potential liabilities have a low probability of crystallising or are very difficult to quantify reliably, the Company treats them as contingent liabilities. Such liabilities are disclosed in the notes but are not provided for in the financial statements. Although there can be no assurance regarding the final outcome of the legal proceedings, the Company does not expect them to have a materially adverse impact on our financial position or profitability.


11 Non-current assets classified as held for sale


Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. Upon relocation of Company’s employees to new office premises in Mumbai, the leasehold immovable property together with buildings and structure standing thereon was lying vacant. The said transaction involves the transfer of leasehold rights. The Company has made an estimate of the fair value of the leasehold right in the land, the valuation for which is based on the unobservable inputs which involves the estimation of consideration made by the management of the Company.


1C FIRST TIME ADOPTION OF IND AS


These are Bajaj Electricals Limited’s (“BEL” or “Company”) first financial statements prepared in accordance with Ind AS. The accounting policies set out in this financial statements have been applied in preparing the financial statements for the year ended 31 March 2017, the comparative information presented in these financial statements for the year ended 31 March 2016 and in the preparation of an opening Ind AS balance sheet at 1 April 2015 (date of transition). In preparing its opening Ind AS balance sheet, BEL has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (“previous GAAP” or “Indian GAAP” or “IGAAP”). An explanation of how the transition from previous GAAP to Ind AS has affected BEL’s financial position, financial performance and cash flows is set out in the following tables and notes.


Explanation 1 - Exemptions and exceptions availed


Explanation 2 - Total Comprehensive Income Reconciliation for the year ended 31 March 2016


Explanation 3 - Equity Reconciliation as at the date of transition (April 1, 2015) and as at 31 March 2016


Explanation 4 - Impact on cash flows for the year ended 31 March 2016


Explanation 1 - Exemptions and exceptions availed


Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.


Ind AS Optional exemptions


- Deemed Cost


Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets


Accordingly, BEL has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying values.


- Share-based payment transactions


Ind AS 102 deals with the accounting and disclosure requirements related to share-based payment transactions. Under Ind AS 101, a firsttime adopter is encouraged, but not required, to apply Ind AS 102 Share-based payment to equity instruments that vested before date of transition to Ind ASs. However, if a first-time adopter elects to apply Ind AS 102 to such equity instruments, it may do so only if the entity has disclosed publicly the fair value of those equity instruments, determined at the measurement date, as defined in Ind AS 102.


The Company operates a number of equity settled, employee share based compensation plans, under which the Company receives services from employees as consideration for equity shares of the Company. The Company has granted stock options to its employees under the Growth Plan as well as Loyalty Plan.


Accordingly, BEL has elected this optional exemption and hence Ind AS 102 Share-based payments has not been applied to equity instruments that vested before the date of transition.


- Investments in subsidiaries, joint ventures and associates


When an entity prepares separate financial statements, Ind AS 27 requires it to account for its investments in subsidiaries, joint ventures and associates either at cost; or in accordance with Ind AS 109.


If a first-time adopter measures such an investment at cost in accordance with Ind AS 27, it shall measure that investment at one of the following amounts in its separate opening Ind AS Balance Sheet:


(a) cost determined in accordance with Ind AS 27; or


(b) deemed cost.


The deemed cost of such an investment shall be its:


(i) fair value at the entity’s date of transition to Ind ASs in its separate financial statements; or


(ii) previous GAAP carrying amount at that date.


A first-time adopter may choose either (i) or


(ii) above to measure its investment in each subsidiary, joint venture or associate that it elects to measure using a deemed cost.


Accordingly BEL has an investment in a joint venture Starlite Lighting Limited (“SLL”) and in an associate Hind Lamps Limited (“HLL”) which are disclosed at previous GAAP carrying amount at the date of transition


- Non-current assets held for sale and discontinued operations


Ind AS 105 requires non-current assets (or disposal groups) that meet the criteria to be classified as held for sale, non-current assets (or disposal groups) that are held for distribution to owners and operations that meet the criteria to be classified as discontinued and carried at lower of its carrying amount and fair value less cost to sell on the initial date of such identification.


A first time adopter can:


(a) measure such assets or operations at the lower of carrying value and fair value less cost to sell at the date of transition to Ind ASs in accordance with Ind AS 105; and


(b) recognize directly in retained earnings any difference between that amount and the carrying amount of those assets at the date of transition to Ind ASs determined under the entity’s previous GAAP.


BEL has certain non-current assets that qualify to be classified as non-current assets held for sale under Ind AS 105. Accordingly, BEL has measured such assets at the carrying value at the date of transition to Ind AS determined under the entity’s previous GAAP. Also since the carrying value is lesser as compared to the fair value less cost to sell on the initial date of such identification, there is no impact on retained earnings.


Ind AS mandatory exceptions


- De-recoanition of financial assets and liabilities Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity’s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.


BEL has a factoring and channel financing facility for its trade receivables. Such trade receivables under the respective facilities do not meet derecognition criteria as there is a final recourse on BEL. Since BEL has the necessary information needed to apply Ind AS 109 to financial assets and financial liabilities derecognised as a result of past transactions, BEL has chosen to apply the same for outstanding transactions as at the transition date.


Hence such factored trade receivables are grossed up and the corresponding amount is shown as short term borrowings under current financial liabilities. In case of channel financing facility, the corresponding amount is shown as current liabilities.


- Estimates


An entity’s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at 1 April 2015 are consistent with the estimates as at the same date made in conformity with previous GAAP.


- Classification and measurement of financial assets


Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS. Accordingly classification and measurement of financial assets have been made based on the facts and circumstances that exist at the date of transition to Ind AS


- Government loans


A company shall classify all government loans received as a financial liability or an equity instrument in accordance with Ind AS 32, Financial Instruments: Presentation. A first time adopter shall apply the requirements in Ind AS 109, Financial Instruments, and Ind AS 20, Accounting for Government Grants and Disclosure of Government Assistance, prospectively to government loans existing at the date of transition to Ind ASs and shall not recognize the corresponding benefit of the government loan at a below-market rate of interest as a government grant. Consequently, if a first-time adopter did not, under its previous GAAP, recognize and measure a government loan at a below-market rate of interest on a basis consistent with Ind AS requirements, it shall use its previous GAAP carrying amount of the loan at the date of transition to Ind ASs as the carrying amount of the loan in the opening Ind AS Balance Sheet. An entity shall apply Ind AS 109 to the measurement of such loans after the date of transition to Ind AS.


However, an entity may apply the requirements in Ind AS 109 and Ind AS 20 retrospectively to any government loan originated before the date of transition to Ind ASs, provided that the information needed to do so had been obtained at the time of initially accounting for that loan.


The company has sales tax deferral loan at the transition date which is to be paid in installments to the state government authorities. Accordingly it has chosen to apply the requirements of Ind AS 109 and Ind AS 20 prospectively to such kind of loans.


(A) Remeasurements of post-employment benefit obligations


Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended 31 March 2016 increased by Rs. 331.76 lakh. There is no impact on the total equity as at 31 March 2016.


(B) Equity-settled employee share-based plan


Under the previous GAAP, the cost of equity-settled employee share-based plan was recognized using the intrinsic value method. The options are granted at closing price on the exchange where there is highest trading volume on working day prior to the date of grant, resulting in no intrinsic value. Under Ind AS, the cost of equity settled share-based plan is recognized based on the fair value of the options as at the grant date. Consequently, the amount recognized in share option outstanding account is Rs.967.80 lakh as at 31 March 2016 (1 April 2015 - Rs. 555.56 lakh). The profit for the year ended 31 March 2016 decreased by Rs.467.75 lakh. There is no impact on total equity.


(C) Financial guarantee contracts


Under the previous GAAP, financial guarantee given was disclosed as a contingent liability. Under Ind AS, financial guarantee contracts are considered as financial liabilities and are measured at initial recognition at fair value. Subsequently, it is measured at an amount initially recognized less the cumulative amount of income recognized under Ind AS. Consequently, at the transition date, a financial guarantee obligation was recognized of the value Rs.622.02 lakh and the corresponding value is added to the cost of investment in Joint Venture ‘Starlite Lighting Limited’. The profit for the year and total equity as at 31 March 2016 has increased to the extent of Rs.136.47 lakh on account of finance income on the financial guarantee obligation. Accordingly, the balance of financial guarantee obligation is Rs.485.55 lakh as at 31 March 2016.


(D) Investment in preference shares of a Starlite Lighting Limited (joint venture) and Hind Lamps Limited (associate)


The Company has investment in preference shares which are either redeemable at premium or carry a cumulative rate of interest. Under the previous GAAP, the said investments were classified as long term investments or current investments based on the intended holding period. These investments were carried at cost less provision for other than temporary decline in the value of such investments. Under Ind AS, the said investments are considered as financial assets and classified as per the business model under which they are held. Thereby these investments are either classified at fair value through profit or loss or at amortized cost. The company measures preference shares of HLL and 0% Non-convertible preference shares of SLL at amortized cost and both issues of 9% non-convertible preference shares of SLL at fair value through profit or loss. These shares have been recognized at their fair value at initial recognition with a corresponding adjustment made to equity in case of SLL and to investment in equity of HLL in case of HLL. Consequently, total equity as at 1 April 2015 has increased by Rs.654.38 lakh. The interest income in respect of preference shares held at amortized cost is Rs.392.87 lakh and the fair value gain recognized is Rs.205 lakh for the year ended 31 March 2016. Accordingly, the profit for the year has increased by Rs.597.87 lakh and total equity as at 31 March 2016 has increased by Rs.1,252.25 lakh.


(E) Financing arrangements


(i) Borrowings:


Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognized in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method. Under previous GAAP, these transaction costs were charged to profit or loss as and when incurred. Accordingly, borrowings as at 31 March 2016 have been reduced by Rs.12.75 lakh (1 April 2015 - Rs.28.71 lakh) with a corresponding adjustment to retained earnings. The total equity increased by an equivalent amount. The profit for the year ended 31 March 2016 reduced by Rs.15.96 lakh as a result of the additional interest expense.


(ii) Fair valuation of forward contracts:


Under previous GAAP, premium on forward contracts was amortized over the life of the contract. Under Ind AS, forward contracts are measured at fair value (MTM). Accordingly, there is an increase in equity of Rs. 51.33 lakh (1 April 2015- Rs.94.65 lakh) as at 31 March 2016. The net profit for the year ended 31 March 2016 has reduced by Rs.43.33 lakh.


The derivatives asset are marked to market at each reporting date. Accordingly, there is a decrease in equity of Rs.52.11 lakh (1 April 2015 - Rs.96.83 lakh) as at 31 March 2016. The net profit for the year ended 31 March 2016 has increased by Rs.44.72 lakh.


(iii) Fair valuation of currency swap:


Under previous GAAP, changes in fair value of currency swap were recognized only to the extent of losses. Under Ind AS, derivative contracts are required to be measured at fair value (i.e. Marked-to-market). Accordingly, currency swaps are marked to market and a fair value gain of Rs.58.34 lakh has been recognized for the year ended 31 March 2016 and total equity has increased by that amount as at 31 March 2016.


(F) Net Impact on Profit or Loss due to discounting of Financial Assets & Financial Liabilities


(i) Warranty provision and expense


Under the previous GAAP, long term provisions were not discounted. Under Ind AS, where the effect of the time value of money is material, the amount of provision shall be the present value of the expenditures expected to be required to settle the obligation. Accordingly, the warranty provision is recorded at its present value using an appropriate discount rate. Ind AS also provides that the discounted liability is to be increased in each period to reflect the unwinding effect of passage of time. The said increase is recognized as finance cost. Consequently, the warranty provision has decreased by Rs.229.86 lakh for the year ended 31 March 2016 (1 April 2015 - Rs.249.63 lakh). The total equity has increased by Rs.249.63 lakh as at 1 April 2015. The profit for the year ended 31 March 2016 has reduced to the extent of Rs.142.53 lakh as a result of the finance cost recognized and has increased to the extent Rs.122.76 lakh on account of discounted value of warranty expense for the year ended 31 March 2016. The net decrease in profit is of Rs.19.77 lakh for the year ended 31 March 2016.


(ii) Interest-free refundable security deposits


Under the previous GAAP, interest free lease security deposits are recorded at their transaction value. Under Ind AS, all financial assets are required at initial recognition at fair value. Accordingly, the company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposit has been recognized as prepaid rent under non-current assets. Consequent to this change, the amount of security deposits decreased by Rs.193.86 lakh as at 31 March 2016 (1 April 2015 - Rs.289.86 lakh). The prepaid rent increased by Rs.173.23 lakh as at 31 March 2016 (1 April 2015 - Rs.271.75 lakh). Total equity decreased by Rs.20.63 lakh (1 April 2015 - Rs.18.11 lakh) for the year ended 31 March 2016. The profit for the year decreased by Rs.2.52 lakh due to amortization of the prepaid rent of Rs.98.52 lakh which is partially off-set by notional interest income of Rs.96 lakh.


(iii) Retention Receivable


Under the previous GAAP, contract revenue was recognized on the basis of consideration received or receivable. Under Ind AS, contract revenue should be recognized on the basis of fair value of consideration received or receivable. Where there is a significant financing component in the revenue, the fair value of the consideration would be the discounted value of revenue. The company has long term retention receivables from construction contracts. Accordingly, contract revenue has been discounted to its present value to the extent of long term retention receivables to reflect its fair value. The carrying amount of retention receivable is increased by the interest amount to reflect the passage of time. This income is recorded as finance income in the profit and loss statement. If a trade receivable is received earlier than its due date, the revenue increases to the extent of the difference between the transaction value and carrying value. Consequently, long term trade receivables have reduced by Rs.1,237.36 lakh as at 31 March 2016 (1 April 2015- Rs.3,239.48 lakh) and equity has increased by an equivalent amount. The revenue for the year ended 31 March 2016 has increased by Rs.363.93 lakh and the interest income has increased by Rs.1,638.19 lakh. Accordingly, the profit and total equity for the year ended 31 March 2016 has increased by Rs.2,002.12 lakh.


(iv) Retention payable


The company has long term retention payables in respect of subcontracting and erection expenses. Under previous GAAP, these amounts were recognized at the transaction value. Under Ind AS, financial liabilities are recognized at fair value at initial recognition and subsequently carried at amortized cost. Accordingly, the company has discounted its retention payable. The carrying value of retention payable will be increased by the interest expense each year to reflect the passage of time. This interest expense is recognized as finance cost. If retention payable is paid earlier than its due date, the difference between the transaction value and carrying amount is recognized as additional erection expense. Consequently, retention payable for the year ended 31 March 2016 has reduced by Rs.150.60 lakh (1 April 2015 - Rs.430.08 lakh) and equity has increased by an equivalent amount. The subcontracting expense for the year has increased by Rs.92.74 lakh and the interest expense recognized for the year is Rs.186.74 lakh. Accordingly, profit for the year has reduced by Rs.279.48 lakh.


(G) Other Adjustments


(i) Revaluation Reserve


Under previous GAAP, the company had revalued some items of its property, plant and equipment (buildings and premises on ownership basis) and had recognized a revaluation reserve. Under Ind AS, the company has elected to measure all of its property, plant and equipment at their previous GAAP carrying value. Accordingly, the revaluation reserve of Rs.808.60 lakh is no longer required and has been transferred to retained earnings at the transition date. The profit has reduced by Rs.21.01 lakh for the year ended 31 March 2016 as there is no revaluation reserve to absorb the increase in depreciation due to revaluation of property, plant and equipment. There is no impact on total equity for the year ended 31 March 2016 or 1 April 2015.


(ii) Non-Current Assets held for sale


The company is intending to sell its Naperol Tower and Reay road property and has located buyers for the same. Under previous GAAP, the concept of assets held for sale does not exist. Ind AS requires noncurrent assets to be identified as held for sale if the carrying amount will recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. Ind AS 105 lays down detailed guidelines and criteria in this regard. Based on the assessment performed by the management, it has been determined that the assets and liabilities of Naperol Tower and Reay Road should be presented as held for sale under Ind AS. Consequently, the assets and liabilities of the above mentioned assets held for sale have been presented separately from the other assets and other liabilities respectively in the balance sheet and depreciation on those non-current assets has been ceased. Accordingly, depreciation of Rs. 7.05 lakh has been reversed for the year ended 31 March 2016 resulting which profit and total equity have increased by an equivalent amount. Based on above, the following assets and liabilities were classified as held for sale as at 31 March 2016:


(H) Deferred Tax


Under previous GAAP, deferred tax was accounted based on the differences between taxable profits and accounting profits for the period. Under Ind AS, entities are required to use a balance sheet approach, which is based on the temporary differences between the carrying amounts of an asset or liability in the balance sheet and its tax base. Deferred tax shall also be created on various transitional adjustments. For transactions and other events recognized in profit or loss, any related tax effects are also recognized in profit or loss. For transactions and other events recognized outside profit or loss (either in other comprehensive income or directly in equity), any related tax effects are also recognized outside profit or loss (either in other comprehensive income or directly in equity, respectively). Consequently, deferred tax assets (net) have increased by Rs.642.41 lakh with an equivalent increase in equity as at 1 April 2015. The company has recognized deferred tax liability (net) of Rs.853.95 lakh for the year ended 31 March 2016 in the profit and loss account and other comprehensive income has increased to the extent of'''' 107.12 lakh on account of deferred tax asset created. Accordingly, total equity as the 31 March 2016 has reduced by Rs.104.42 lakh.


(I) Other comprehensive income


Under Ind AS, all items of income and expense recognized in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss as ‘other comprehensive income’ consist of remeasurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP. Consequently, the other comprehensive income has decreased by Rs.224.64 lakh (net of deferred tax) on account of remeasurement of defined benefit plans for the year ended 31 March 2016.


(J) Retained Earnings


Retained earnings as at 1 April 2015 has been adjusted consequent to the above Ind AS transition adjustments.


(K) Proposed dividend


Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognized as a liability. Under Ind AS, such dividends are recognized when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend of Rs. 1,819.16 lakh (inclusive of dividend distribution tax of Rs.307.73 lakh) as at 1 April 2015 included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity as at 1 April 2015 increased by an equivalent amount. The said dividend has been paid in the financial year 2015-16. There was no proposed dividend as at 31 March 2016.


Ind AS Adjustments having no effect on profit or total equity.


12. Provision for discounts and schemes:


Under previous GAAP, provision for discounts and schemes were classified as provisions. Under Ind AS, these have been netted off from trade receivables since they are considered as crystallized liability. Accordingly, trade receivables has reduced by Rs.3,541.31 lakh as at 31 March 2016 (1 April 2015- Rs.2,204.10 lakh).


Similarly cash discount under previous GAAP was considered as an expense. Under Ind AS, revenue is to be shown net of all discounts, rebates, etc. Accordingly the cash discount has been netted against sales. This has reduced the sales and expenses by Rs.3,185.26 lakh for the year ended 31 March 2016. This however has no impact on profit.


13. Excise Duty


Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the statement of profit and loss as part of expenses. This change has resulted in an increase in total revenue and total expenses for the year ended 31 March 2016 by Rs.3,640.55 lakh.


14. Commercial Paper


Under previous GAAP, the amount payable on maturity was recognized as borrowings and the difference between amount received from holders of commercial paper and amount payable on maturity was recognized as prepaid expense. Under Ind AS, borrowings are financial liabilities which are measured at amortized cost using effective interest rate. Accordingly, prepaid interest has been net off from borrowings to reflect the amortized cost and borrowings has reduced by Rs.45.43 lakh as at 1 April 2015. There is no commercial paper as at 31 March 2016.


15. Factoring and Channel Financing


The company offers its dealers and distributors a channel financing facility using which they customers can discount bills drawn on them by the company using the company’s line of credit. The interest will be borne by the company. This facility has 100% recourse to the Company. It also offers the facility of factoring. This facility is with full recourse to the company. Under previous GAAP, bills discounted and factoring were disclosed as contingent liability. Under Ind AS, trade receivables should be derecognized only if it meets the derecognition requirements of Ind AS. Accordingly, trade receivables have increased by Rs.7,215.36 lakh (1 April 2015 - Rs.6,440.81 lakh) with a corresponding increase in borrowings of Rs.5,082.40 lakh (1 April 2015 - Rs.4,604.23 lakh) in relation to factoring and an increase of Rs.2,132.96 lakh (1 April 2015 - Rs.1,836.58 lakh) in other financial liabilities in relation to channel financing as at 31 March 2016.


16. Acceptances


The company offers its vendors a facility using which vendors can discount bills drawn on the company using the company’s line of credit. The interest will be borne by the company. Under previous GAAP, these acceptances from vendors were classified under trade payables. However, they are in the nature of short term borrowings from the bank. Accordingly, acceptances have been reclassified to borrowings from trade payables. Accordingly, acceptances of Rs.50,118.89 lakh (1 April 2015 - Rs.57,329.76 lakh) have been reclassified to borrowings as at 31 March 2016.


17. Loan to an associate (Hind Lamps Limited)


The company has extended a loan of Rs.1,152 lakh to its associate company Hind Lamps Limited. The said loan has also been provided to the extent of Rs. 1,000 lakh and net amount was reflected under the previous GAAP under loans and advances. This loan had no repayment terms and carried a mandated rate of 6% through its term. Under Ind AS, where there are such loans which are given to subsidiary, associate or joint venture, without any repayment terms the same is considered as a capital infusion in such subsidiary, associate or joint venture. Accordingly, the loan of Rs.1,152 lakh has been added as an investment in the associate and the same has been impaired to the extent of Rs.1,000 lakh. This classification does not have any impact on equity.


Explanation 4 - Impact on cash flows for the year ended 31 March 2016


There are no impacts in cash flows due to transition to Ind AS.


(ii) Property, plant and equipment pledged as security


Refer to note 43 for information on property, plant and equipment pledged as security by the group.


(iii) Contractual obligations


Refer to note 41 for disclosure of contractual commitments for the acquisition of property, plant and equipment.


(iv) Capital work-in-progress


Capital work-in-progress mainly comprises Property, Pland and Equipments used in R& D Centre.


(v) Refer Note 1B.4 for Accounting Policy NOTE 3 : OTHER INTANGIBLE ASSETS


* The investment is shown net of impairment.


** In respect of Investments made in M. P. Lamps Ltd., calls of Rs. 2.50 per share on 48,000 equity shares and Rs.3.75 per share on 95,997 Equity Shares aggregating to Rs.4.80 lakh have not been paid by the Company. On principles of prudence the entire investment in M.P. Lamps Ltd. is considered as diminished and accordingly carried at Rs.NIL.


***There is proposed scheme of demerger under consideration by both the Bajaj Electricals Limited (“Resulting Company”) and Hind Lamps Limited (“Demerged Company”) to demerge the manufacturing business (“Demerged Undertaking”) of Hind Lamps Limited and to be transferred to Bajaj Electricals Limited.


As per the modified draft rehabilitation scheme filed with the Hon’ble BIFR for the revival of the Demerged Company, the net worth of the Demerged Company was expected to turn positive by 31 March 2014. The Demerged Company couldn’t achieve the aforesaid objective and accordingly the management of the Demerged Company decided to make an attempt to achieve positive net worth by 31 March 2015. However, as on 31 March 2015, the Demerged Company could not achieve positive net worth and accordingly, it has been proposed to demerge the Manufacturing Business of the Demerged Company with the Resulting Company with effect from the appointed date of 31 March 2014.


The scheme of arrangement (the “Scheme”) is drawn up pursuant to the provisions of Sections 230-232 of the Companies Act, 2013 and other relevant provisions of the Companies Act, 2013 and the Income Tax Act, 1961 as may be applicable for the transfer by way of demerger of the Demerged Undertaking of the Demerged Company to the Resulting Company in the manner provided for in the Scheme.


The Board of Directors of the Demerged Company and the Resulting Company are of the view that the transfer and vesting of the Manufacturing Business of the Demerged Company to the Resulting Company will enable both the Demerged Company and the Resulting Company to achieve and fulfill their objectives more efficiently and economically and the same is also in the interest of all stakeholders. The Resulting Company’s existing management expertise and quality systems & controls will enhance the performance of the business of the Demerged Undertaking. The Scheme is expected to contribute in furthering and fulfilling the objects of the Demerged Company and the Resulting Company and to facilitate the revival of the Manufacturing Business of the Demerged Company upon its consolidation with the Resulting Company.


Transferred receivables


The carrying amount of trade receivables, include receivables which are subject to factoring arrangements and channel financing facilities. Under this arrangement the Company has transferred the relevant receivables to the factor in exchange for cash. The said facilities are with recourse to company, the Company therefore continues to recognize the transferred assets in their entirety in its balance sheet. The amount repayable under the factoring agreement is presented as unsecured borrowings/other current liabilities.


Amounts recognized in profit or loss


Write-downs of inventories to net realizable value amounted to Rs.800.69 lakh (31 March 2016 - (Rs. 166.04 lakh)). These were recognized as an expense during the year and included in ‘changes in value of inventories of work-in-progress, stock-in-trade and finished goods’ in statement of profit and loss.


Upon relocation of Company’s employees to new office premises in Mumbai, the leasehold immovable property together with buildings and structure standing thereon was lying vacant. Therefore, the Board of Directors of the Company approved the sale and transfer of leasehold rights therein in favour of the purchaser vide Resolution dated 23 March 2015 subject to the permissions from the appropriate authorities and accordingly the said transaction of sale and transfer of leasehold rights was to be completed within one (1) year. However, on account of delay in getting the requisite permissions from the appropriate authorities the transaction is yet pending.


Further, on 29 March 2017, the Board of Directors of the Company approved the sale of Company owned residential premises to unlock the investment therein as the usage thereof was minimum. The sale of these residential premises will be completed within one (1) year.


The asset held for sale are not attached to any reported business segment but part of other unallocable assets.


ii) Terms and rights attached to equity shares


The Company has only one class of equity shares having a par value of''''2 per share. Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.


Secured Non Current Borrowings:


Sr. No. Nature of Security and Terms


Zero Coupon Redeemable Non Convertible Debentures (NCD) are secured by First Charge over the following premises :


i) Delhi Office : No. DSM-514 to DSM-521, DLF Tower, 5th Floor, 15 Shivaji Marg, Nazafgarh Road Industrial Area, Delhi -110015


ii) Office Premises No: 001, 701 & 801, ‘RustomjeeAspiree’, Bhanu Shankar Yagnik Marg, Off Eastern Express Highway, Sion (East), Mumbai - 400 022


iii) Factory Units (Unit I and II) at Ranjangaon - Plot No. B-7 & B-29 , Ranjangaon Industrial Area, Village Dhoksangvi, Taluka Shirur, Dist. Pune


iv) Factory unit at Chakan - Village Mahalunge, Chakan Talegoan Road, Khed, Pune - 410501


v) Showroom on Ground floor and Office Premises on Second Floor at Bajaj Bhawan 226, Jamnalal Bajaj Marg, Nariman Point, Mumbai 400 021.


*NCD’s are issued at Zero Coupon corresponding to YTM of 10.85% p.a. compounded annually. Post downgrading of credit rating by ICRA Ltd. (Credit Rating Agency) from ‘A ’ to ‘A’ on 24 February 2015, the YTM has been increased by 0.25% p.a. with effect from 24 February 2015.


“ICRA Limited vide its letter No 2016-17/MUM/0697 dated 18 August 2016, communicated that it has upgraded the rating of the Company’s NCD programme from ‘A to ‘A ’. However there is no corresponding change in the interest rate. ** Current (shown as Other Current Financial Liabilities in Note no. 18)


Foreign Currency Term Loan :


Foreign Currency Term loan is availed from Kotak Mahindra Bank Ltd is secured by :


Nature of Security


First Charge on following properties:


a) Kosi Factory Unit at Khasra No.647,648, NH 02, Km 109 Mile Stone, Village Dautana, Chhatta, Kosi Kalian, Mathura - 281 403.


b) Office Premises No: 502, ‘Rustomjee Aspiree’, Bhanu Shankar Yagnik Marg, Off Eastern Express Highway, Sion (East), Mumbai - 400 022.


c) R&D centre at Plot no. 27/ pt 2 at Millennium Business Park, TTC Industrial area, Mahape, Navi Mumbai.


d) Wind Farm : Village Vankusawade, Tal. Patan, Dist. Satara, Maharashtra - 415 206.


Unsecured:


Sales Tax Deferral Liability/Loan


Terms of Repayment: Sales Tax deferral liability/loan is repayable free of interest over predefined instalments from the initial date of deferment of liability, as per respective schemes of incentive.


Secured Current Borrowings:


Loans from Consortium Banks are secured by :


a First pari passu charge by way of hypothecation of inventories and book debts, b First pari passu charge on the Company’s immovable properties at:


i) Wardha premises - Plot no. 36, Block no. 17, Mouza no. 225, Bacharaj road, Gandhi Chowk, Wardha.


ii) Hari Kunj - Flat No. 103 and 104, ‘B’ wing, Sindhi Society, Chembur East, Mumbai - 400 071. c Second pari passu charge over present and future Fixed Assets ofthe Company, situated at:


i) Ranjangaon Units : Village Dhoksanghvi, Taluka Shirur, Ranjangaon, Dist. Pune - 412 210.


ii) Chakan Unit: Village Mahalunge, Chakan Talegaon Road, Khed, Pune - 410 501.


iii) Wind Farm : Village Vankusawade, Tal. Patan, Dist. Satara, Maharashtra - 415 206.


iv) Showroom on Ground floor and Office Premises on Second Floor at Bajaj Bhawan 226, Jamnalal Bajaj Marg, Nariman Point, Mumbai - 400 021.


v) Delhi Office : No. DSM-514 to DSM-521, DLF Tower, 5th Floor, 15 Shivaji Marg, Nazafgarh Road Industrial Area, Delhi-West, Delhi -110 015.


vi) Office Premises No : 001, 502, 701 and 801, ‘Rustomjee Aspiree’, Bhanu Shankar Yagnik Marg, Off Eastern Highway, Sion (East), Mumbai - 400 022.


vii) Kosi Factory Unit at Khasra No.647,648, NH 02, Km 109 Mile Stone, Village Dautana, Chhatta, Kosi Kalian, Mathura - 281 403.


viii) R&D centre at Plot no. 27/ pt 21 at Millennium Business Park, TTC Industrial area, Mahape, Navi Mumbai. These securities also extend to the various credit facilities including Bank Guarantees and Letters of Credit of Rs.156,469.16 lakh (Previous year Rs. 121,964.98 lakh) executed on behalf of the Company in the normal course of business.


The carrying amounts of financial and non-financial assets pledged as security for current and non-current borrowings are disclosed in note 42.


Description of Risk Exposures


Valuations are performed on certain basic set of pre-determined assumptions and other regulatory framework which may vary over time. Thus, the Company is exposed to various risks in providing the employee benefit. The assumptions are as follows:


Interest Rate risk: The plan exposes the Company to the risk of fall in interest rates. A fall in interest rates will result in an increase in the ultimate cost of providing the benefit and will thus result in an increase in the value of the liability.


Liquidity Risk: This is the risk that the Company is not able to meet the short-term benefit payouts. This may arise due to non availability of enough cash I cash equivalent to meet the liabilities or holding of illiquid assets not being sold in time.


Salary Escalation Risk: The present value of the defined benefit plan is calculated with the assumption of salary increase rate of plan participants in future. Deviation in the rate of increase of salary in future for plan participants from the rate of increase in salary used to determine the present value of obligation will have a bearing on the plan’s liability.


Demographic Risk: The Company has used certain mortality and attrition assumptions in valuation of the liability. The Company is exposed to the risk of actual experience turning out to be worse compared to the assumption.


Regulatory Risk: Gratuity benefit is paid in accordance with the requirements of the Payment of Gratuity Act, 1972 (as amended from time to time). There is a risk of change in regulations requiring higher gratuity payouts (e.g. Increase in the maximum limit on gratuity of Rs. 10,00,000).


Asset Liability Mismatching or Market Risk: The duration of the liability is longer compared to duration of assets, exposing the Company to market risk for volatilities/fall in interest rate.


Investment Risk: The probability or likelihood of occurrence of losses relative to the expected return on any particular investment.


Asset Volatility Risk: Gratuity funds are with the Insurance Companies and those are subject to interest rate risk and the Insurance Company’s fund managers manage interest rate risk with derivatives to minimize risk to an acceptable level. A portion of the funds are invested in equity securities and in alternative investments which have low correlation with equity securities. The company intends to maintain the current investment mix in the continuing years.


For PF Trust Managed Assets, the plan liabilities are calculated using a discount rate set with reference to bond yields; if plan assets underperform this yield, this will create a deficit. The plan asset investments are in fixed income securities with high grades. The company has a risk management strategy for PF Fund Investments where the aggregate amount of risk exposure on a portfolio level is maintained at a fixed range. Our PF funds are managed by PF trust and the investment decisions are taken by Trustees as per advice and recommendations of 2 professional consultants. Any deviations from the range are corrected by rebalancing the portfolio.


Asset Liability Matching Strategies


The Company has purchased insurance policy from renowned insurance companies, which is basically a year-on-year cash accumulation plan in which the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance company, as part of the policy rules, makes payment of all gratuity outgoes happening during the year (subject to sufficiency of funds under the policy). The policy, thus, mitigates the liquidity risk. However, being a cash accumulation plan, the duration of assets is shorter compared to the duration of liabilities. Thus, the Company is exposed to movement in interest rate (in particular, the significant fall in interest rates, which should result in a increase in liability without corresponding increase in the asset).


But insurers has ensured that the investment positions are managed within an asset-liability matching (ALM) framework to achieve long-term investments that are in line with the obligations under the employee benefit plans.


As far as the PF Trust Investments are concerned, the same are managed by Trustees as per advice and recommendations of 2 professional consultants. The Employees’ Provident Fund Organization, Ministry of Labour, Government of India, vide its notification in official gazette notified the pattern of investment for EPF exempted establishments, which depicts the obligatory pattern of investments of PF contributions and interests. The pattern mandates to invest as below :


The Leave Encashment Schemes, superannuation and pension schemes are managed on unfunded basis, hence Asset Liability Matching Strategies are not applicable


Effect of any Amendments, Curtailments and Settlements


In connection with the closure of Kosi factory, a curtailment loss was incurred and a settlement arrangement agreed with the employees which were settled for all retirement benefit plan obligations relating to the employees of that factory. The terminated employees were not eligible for gratuity, nonetheless, they were paid an adhoc ex-gratia towards curtailment and retrenchment of their services. Likewise the terminated employees were paid off for their due Leave Balances. The terminated employees of Kosi Unit were covered under RPFC and thus Bajaj Electricals Limited had no liability towards settlement of their PF Claims


Sensitivity Analysis


The readers of the annual report should note that the sensitivity analysis presented here may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. There is no change in the method of valuation for the prior period.


* The present value of obligation of provident fund represents the aggregate of accumulated fund value of Rs. 1,089,833,403 (As on 31 March 2016 - Rs. 934,407,118, As on 1 April 2015 - Rs.798,772,150) and interest rate guarantee Rs.17,272,606 (As on 31 March 2016 - Rs. 14,162,803, As on 1 April 2015 - Rs. 11,938,286). Of the above, the interest rate guarantee is recognized as provision in the Company’s books, while the accumulated fund value is recognized by the Bajaj Electricals Limited Employees’ Provident Fund Trusts. The interest rate guarantee so recognized in the Company’s books is considered as non-current liability.


# The Fair Value of Non-Qualifying Insurance Policy (being a Reimbursement Right as is with Bajaj Allianz) is spilt in current and non current basis the expected cash flows (on undiscounted basis) over the next 1 year as forming part of maturity profile of Defined Benefit Obligation of Gratuity based on the Actuarial Valuation of Gratuity. The Fair Value of Qualifying Insurance Policy (Plan Asset’s Fair Value) is ignored for this split of Reimbursement Right into current and non-current assuming all the payouts shall be done from Non-Qualifying Insurance Policy during 1 year from the reporting date.


The payment of gratuity is required by the Payment of Gratuity Act, 1972. Responsibility for governance of the plans, including investment decisions and contribution schedules lies with the company. Though the investments for gratuity fund are managed by an insurance company, the company owns the accountability and responsibility of the fund.


For Bajaj Electricals Limited, the gratuity benefit payable to the employees of the Company is greater of the two :


(i) The provisions of the Payment of Gratuity Act, 1972 or (ii) The Company’s gratuity scheme as described below.


The description of plans ability to affect the amount, timing and uncertainty of the entity’s future cash flows


a) Funding arrangements and Funding Policy


The scheme is managed on funded basis. Payment for present liability of future payment of gratuity is being made to approved gratuity fund, which fully covers the same under Cash Accumulation Policies of the Life Insurance Corporation of India (LIC) and Bajaj Allianz Life Insurance Company Ltd. (BALIC). Every year, the insurance company carries out a funding valuation based on the latest employee data provided by the Company. Any deficit in the assets arising as a result of such valuation is funded by the Company.


Bajaj Electricals Limited operates in two schemes for the compliance of provident fund statute - (i) Bajaj Electricals Limited Employees’ Provident Fund Trust (defined benefit plan) and (ii) RPFC Contributions for provident fund (defined contribution plan). An Exempt Provident Fund Scheme is a defined benefit plan, the accounting for which has to be done on an actuarial basis.


The net defined benefit obligation as at the valuation date thus represents the excess of accrued account value plus interest rate guaranteed liability over the fair value of plan assets.


A deterministic approach is considered to estimate the value of Interest Rate Guarantee on the Exempt Provident Fund. The per annum cost of guarantee at which Interest Rate Guarantee Liability has been valued is mentioned above.


The company’s compliances for provident fund is governed by Employees’ Provident Fund and Miscellaneous Provisions Act, 1952. Responsibility for governance of the plans, including investment decisions and contribution schedules lies jointly with the company and the board of trustees. The board of trustees are composed of representatives of the company and plan participants in accordance with the plan’s regulations.


The description of plans ability to affect the amount, timing and uncertainty of the entity’s future cash flows a) Funding arrangements and Funding Policy


The scheme is managed on funded basis. Payment for present liability of future payment of PF is made by the Company towards shortfall of Bajaj Electricals Limited Employees’ Provident Fund Trust, the investments for the same are managed by Trustees as per advice and recommendations of 2 professional consultants and in compliance of obligatory pattern of investments as per government notification in official gazette for the pattern of investment for EPF exempted establishments. Any deficit in the assets of PF Trust is funded by the Company. The provident fund for certain employees is a defined contribution plans covered under RPFC Contributions.


* Last In First Out (LIFO) basis i.e. future leave availments are first assumed to be from future leave accruals.


Responsibility for governance of the Earned Leave Plan lies with the company. Though the Earned Leave Plan is unfunded scheme, the company owns the accountability and responsibility of meeting the commitment towards settlement of the unfunded obligation that arises from time to time.


* Last In First Out (LIFO) basis i.e. future leave availments are first assumed to be from future leave accruals.


Responsibility for governance of the Earned Leave Plan lies with the company. Though the Earned Leave Plan is unfunded scheme, the company owns the accountability and responsibility of meeting the commitment towards settlement of the unfunded obligation that arises from time to time.


Information as required to be furnished as per Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006) is given below. This information has been determined to the extent such parties have been identified on the basis of information

CIN: U67190WB2003PTC096617. Trading in Commodities is done through our Group Company Dynamic Commodities Pvt. Ltd. The company is also engaged in Proprietory Trading apart from Client Business.
“2019 © COPYRIGHT DYNAMIC EQUITIES PVT. LTD.”

Disclaimer: There is no guarantee of profits or no exceptions from losses. The investment advice provided are solely the personal views of the research team. You are advised to rely on your own judgment while making investment / Trading decisions. Past performance is not an indicator of future returns. Investment is subject to market risks. You should read and understand the Risk Disclosure Documents before trading/Investing.

Disclosure: We, Dynamic Equities Private Limited are also engaged in Proprietory Trading apart from Client Business. In case of any complaints/grievances, clients may write to us at compliance@dynamiclevels.com

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