1 Disclosures as required by Accounting Standard (AS) 15 Employee Benefits:
(a) Defined contribution plans [Refer Accounting Policy Note 1]
Amount of Rs.6.47 crores (Previous year Rs.2.83 crores) is recognised as an expense and included in Employee benefits expense as under the following defined contribution plans: (Refer Note 24)
(b) Defined Benefit Plans [Refer Accounting Policy Note 1] as per Actuarial Valuation are as under:
# Includes Rs.14.99 crores pending transfer from CGL pursuant to the Scheme (Refer Note 43). In absence of adequate information the Company has not recognised any income on the same.
(c) The Company makes a specified percentage of salary as contribution towards superannuation fund, a defined contribution retirement benefit plan for qualifying employees to Trust which administer the scheme.
(d) The Company makes contributions to the Gratuity Trust, which is a funded defined benefit plan for qualifying employees. The Scheme provides for lump sum payment to vested employees at retirement, death while in employment or on termination of employment as per the Company’s Gratuity Scheme. Vesting occurs upon completion of five years of service.
(e) The Company provides post retirement medical benefits to qualifying employees.
(f) The actuarial valuation of plan assets and the present value of the defined benefit obligation were carried out at 31st March, 2017. The present value of the defined benefit obligation and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.
(g) Discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of the obligations.
(h) Expected rate of return on the plan assets is based on the average long-term rate of return expected on investments of the Fund during the estimated term of the obligations.
(i) The salary escalation rate is arrived after taking into consideration the seniority, the promotion and other relevant factors, such as, demand and supply in employment market.
2 Disclosures as required by Accounting Standard (AS) 18 Related Party Disclosures:
i) There is no Related Party over which the Company exercises its control
ii) List of related parties with whom transactions were carried out during the year and description of relationship : Other Related Parties:
1 Crompton Greaves Limited (upto 26th July, 2016)
2 Ballarpur Industries Limited (upto 26th July, 2016)
3 BILT Graphic Paper Products Limited (upto 26th July, 2016)
4 Avantha Business Solutions Limited (upto 26th July, 2016)
Key Management Personal
1 Mr. Shantanu Khosla, Managing Director
2 Mr. Mathew Job, Chief Executive Officer
3 Mr. Sandeep Batra, Chief Financial Officer
4 Mrs. Pragya Kaul, Company Secretary (w.e.f. 19th May, 2016)
3 Disclosures as required by Accounting Standard (AS) 17 Segment Reporting:
(a) Primary Segments (Business Segments)
(b) Secondary Segments (Geographical Segments)
The Company operates predominantly in the domestic market, i.e., in India. Accordingly, information under this segment has not been disclosed.
(c) Unallocable Assets/ Liabilities :
Unallocable assets comprise assets and liabilities which cannot be allocated to the segments. Tax credit assets / liabilities are not considered in capital employed.
(d) Segment Identification, Reportable Segment and definition of each Reportable Segment:
(i) Primary segment :
In the opinion of the management, the business segments comprise the following :
(a) Lighting Products : Luminaires, Light Sources
(b) Electrical Consumer Durables : Fans, Appliances and Pumps
(ii) Primary / Secondary segment reporting format:
(a) The risk-return profile of the Company’s business is determined predominantly by the nature of its products and services. Accordingly, the business segment constitutes the primary segment for disclosure of segment information.
(b) The Company mainly caters to Indian Market only, accordingly, secondary information/ geographical segment is not applicable.
(iii) Segment identification:
Business segments have been identified on the basis of the nature of products / services, the risk-return profile of individual businesses, the organizational structure and the internal reporting system of the Company.
(iv) Reportable segments:
Reportable segments have been identified as per the quantitative criteria specified in the Accounting Standard.
(v) Segment revenue and results:
The expenses and incomes which are not directly attributable to any business segment are shown as unallocable expenditure (net of unallocated income).
(vi) Segment assets and liabilities:
Segment assets include all operating assets used by the business segment and mainly consist of fixed assets, trade receivables and inventories. Segment liabilities primarily include trade payables and other liabilities. Common assets and liabilities which cannot be allocated to any of the segments are shown as a part of unallocable assets / liabilities.
(vii) Inter-segment transfer:
Inter segment prices are normally negotiated amongst segments with reference to the costs, market price and business risks.
4 Exceptional items
Exceptional items include the following:
(a) Expenses in relation to the ‘Scheme’ (Refer Note 43) Rs.2.52 crores (Previous year Rs.11.29 crores)
(b) Deposit written-off Rs.NIL (Previous year Rs.2.64 crores)
5 Expenditure on Corporate Social Responsibility (CSR)
The particulars of CSR expenditure are as follows:
(a) Gross amount required to be spent by the Company during the year is Rs.1.59 crores. (Previous year Rs.NIL)
(b) Amount spent during the year is Rs.0.10 crores (Previous year Rs.NIL)
6 (a) The Company has not entered into any finance lease as specified in Accounting Standard (AS) 19 Leases. The Company has, however, taken various residential/ commercial premises and plant and equipments under operating lease arrangements. These lease arrangements are normally renewed on expiry, wherever required.
(b) During the year, an amount of Rs.18.68 crores was recognized as rent expense in the statement of profit and loss.
7 Foreign currency transactions, Forward contracts and Derivatives
The Company uses forward exchange contracts to hedge against its foreign currency exposures relating to the firm commitments. The Company does not enter into any derivative instruments for trading or speculative purposes.
(a) The particulars of derivative contracts entered into for hedging purposes outstanding as at the year-end are as under:
(b) The foreign currency exposures not hedged as at the year-end are as under:
8 Employee Stock Option Schemes
(a) The Members of the Company have approved grant of employee stock options under various Schemes on 22nd October, 2016 by way of postal ballot. The plan envisaged grant of shares to eligible employees at market price/ pre-determined value as determined by the Compensation Committee of the Board of Directors from time to time.
(b) Number of shares granted under the Schemes are as under:-
(c) The stock-based compensation cost calculated as per the intrinsic value method for the period 1st April, 2016 to 31st March, 2017 is Rs.19.75 crores. If the stock-based compensation cost was calculated as per the fair value method prescribed by SEBI, the total cost to be recognised in the financial statements for the period 1st April, 2016 to 31st March, 2017 would be Rs.30.94 crores The effect of adopting the fair value method on the net income and earnings per share is presented below:
9 Scheme of Arrangement
On 20th November, 2015, the Honourable High Court of judicature at Bombay sanctioned a Scheme of Arrangement (the ‘Scheme’) between the Company and Crompton Greaves Limited (CGL) (now CG Power and Industrial Solutions Limited) and their respective shareholders and creditors. The Consumer Products business of CGL, along with its related assets and liabilities has been transferred to the Company with effect from 1st October, 2015 being the appointed date. The certified copy of the Order sanctioning the Scheme has been filed with the Registrar of the Companies, Maharashtra, on 1st January, 2016. Accordingly, effect of the Scheme was considered in the financial statements of 2015-16.
Further, the Company is in the process of obtaining/transfer to its name the title of certain assets transferred pursuant to the ‘Scheme’.
10 Amounts shown as 0.00 represents amount below Rs.50,000 (Rupees Fifty Thousand).
11 Financial results for the previous year represent the business performance from 1st October, 2015 (being the effective date of the transfer of business into the Company) to 31st March, 2016.
12 Figures for the previous year have been regrouped wherever necessary.