All the figures are rounded off to nearest Lakh

02. Re-Grouping of Amounts

Previous year's figures have been regrouped wherever necessary to confirm to current year classification/ grouping.

03. Accounting Period

The current year figures may not be comparable with the previous year figures, since the current year comprises of a period of 12 (Twelve) months (01-04-2014 to 31-03-2015) as against 9 (Nine) months of previous year (01-07-2013 to 31-03-2014).relating to previous year, to comply with the requirement of Companies Act, 2013.

04. Confirmation of Balance

The Company has sent letters for confirmation of Balance as at 31.03.2015 but only some of the parties have responded. In the opinion of the management the current assets and Loans and Advances will be recovered in full , in the normal course of business.

05. Miscellaneous Expenditure

Due to the Loss during the year, the company has not written off any deferred revenue expenditure and deferral interest during the year. (Previous year Rs..Nil) and same is to be amortized from profit over the expected period of future benefit.

06. Non-Provision for diminution in the value of Investments

The company has not provided for decline in the market value of investment made in the shares of companies as the management is of the opinion that the decline in long term investment is only temporary in nature.

07. Excise duty on the finished goods pending clearance.

Excise duty on closing stock of finished goods has been provided in the accounts and corresponding increase in closing stock valuation has been given effect to.

08. Due to MSME

The Company has not received any memorandum (as required to be filed by the suppliers with the notified authority under the Micro, Small and Medium Enterprises Development Act, 2006) claiming their status as micro, small or medium enterprises. Consequently the amount paid/ payable to these parties during the year has shown Nil

09. Netting off Interest Income

Interest Expenses is shown after setting off interest receipts (Income) amounting to Rs. 12.36 Lakh (Previous year Rs.2.99 Lakh).

10. Non-Payment of Group Gratuity Fund

The Retirement Benefit Funds towards gratuity are administered by LIC under Group Gratuity Scheme. There is a short fall of the amounts provided by the Company to Gratuity Scheme

11. Non-Disclosure of the details under Employees Benefits, AS-15 (Revised)

(01) The Company has opened a Gratuity Scheme with Life Insurance Corporation of India (LIC), for settling any amount due on account of Gratuity. Under the aforesaid Scheme, the company has to contribute annual premium, based on the amount arrived by LIC. Due to continuous operating loss during the earlier years, the Company has not made the payment of Gratuity premium to Life Insurance Corporation of India (LIC). However, required provision on this account has been made in the books of account, in consistent with mercantile method of accounting followed by the company. The management is of the view that liability provided for in the books of account up to the year end is sufficient.

(02) An amount of Rs.207.29 Lakh (Previous year Rs.96.30 Lakh) has been outstanding in respect of the above fund as on 31.03.2015, as per the books of the company. Due to non-payment of annual premium on account of gratuity, the estimated return from the fund or scheme may not be ascertained or determined. Accordingly, no disclosure has been made, in terms of AS-15. The Company is taking sincere steps to make the payment of the amount due and is in the process of adopting AS-15 (Revised), any implications arising there from including the valuation of future liability on actual basis and determination of plan assets will be done in due course.

12. Penalty and Interest

As said earlier, due to operating loss, the company has not been in a position to pay the statutory dues, in time and further statutory dues are still outstanding. Non-payment or delayed payment of such due shall attract interest and penalty. The management is of the view that the amount could not be ascertained. The same has not been provided in the books of account. The same shall be accounted, as and when the payment is made.

13. Change in the method of Accounting

The company has changed the method of accounting of interest on bank borrowings from mercantile to cash basis. The interest on bank borrowings amounting to Rs. 1590.99 Lakh not provided during the year (Previous year Rs.1050.83 Lakh)

14. Pending Litigation.

Some suppliers have filed suit before the Honourable Madras High Court against on the company for recovery of their respective dues. The company has addressed these cases and worked out a schedule of repayment over the following four year term. In some of the cases, winding up petition has been filed before the Honourable Madras High Court and the company has filed the counter requesting repayment over the next few years. The company is hopeful of reaching an understanding with those suppliers. The list of such cases and the amount (Rs. in lakh) involved are given below

15. Investor Education & Protection Fund

(01) Whenever the company declares dividend, it transfers the amount equivalent to an earmarked account, meant for the same, by opening an account with a bank. An unpaid amount, if any, lying in the aforesaid amount shall be transferred to Investor Education & Protection Fund, by taking Demand Draft, from the Bank.

(02) In compliance of the above, the dividend amount, relating to Financial Year 2007-08, has been transferred to an account lying with a nationalized bank. An amount of Rs.3.74 Lakh, remaining unpaid, in that account. The company has taken steps to obtain demand draft to transfer the same to Investor Education & Protection Fund. Since the bank has not issued Demand Draft, the company is not in a position to transfer the same to Investor Education & Protection Fund.

16. Asset Reconstruction Company

(01) The company has borrowed money, both Long Term and Short Term, from a few banks, under consortium. The total outstanding with the banks as at 31st March, 2015 is Rs.13924.54 Lakh (Previous year Rs. 13924.54Lakh). During the current financial year, some of the Banks has assigned (Assignor) their debts to various Asset Reconstruction Companies (ARC's). Export Import Bank of India had assigned their debts to Edelweiss Asset Reconstruction Co. Limited during the previous year. During the current financial year, Union Bank of India assigned its debts to Edelweiss Asset Reconstruction Co. Ltd and State Bank of India assigned its entire debts to Asset Reconstruction Company (India) Ltd, (Arcil). The borrowing, form IDBI Bank, Axis Bank Ltd and Royal Bank of Scotland still remains with the respective banks.

(02) The current liabilities of long term debts were classified as current liabilities in the previous year. Now the current maturities of IDBI Bank and Axis Bank alone are shown under current liability.

(03) Due the assignment of debts by banks to the ARC's, the exact due date for the repayment of the Long term Loan (Included in the debts assigned by the Assignor) is not known, since finalization of the terms and conditions between the company and ARC is under process. Accordingly, during the current financial year, the entire amount of long term loan with Edelweiss Asset Reconstruction Company Limited and Asset Reconstruction Company (Inida) Limited are classified as Long Term Borrowing. This has resulted in changing a short term classification (as per the previous year) into a long term classification (During the Current Financial Year) by an amount of Rs. 1671.50 Lakh (Previous year Rs.Nil);

(04) Exact classification of the debts assigned shall be done, in the year of finalisation of the terms and conditions with the ARC.

17. Wholly Owned Subsidiary an Associate Company

(01) There has been a change in the shareholding pattern of Shakespeare Forgings Ltd, the wholly owned subsidiary in UK. Due to market and environmental requirements, additional funds infusement had become obligatory at Shakespeare Forgings Ltd. As our Company was not in a position to accommodate this, the wholly owned subsidiary raised the necessary funds by issuing fresh equity on 02.02.2015. Without additional funds Shakespeare Forgings Ltd would have been forced to curtail its operations in a major way, which might have led to additional financial burden for your Company.

(02) By issuing further shares, the shareholding of the Company in SFL has been reduced to 37.50% from 100% with effect from 02.02.2015. Accordingly, SFL has been become Associate Company and ceased to be a WOS.

(03) For the year under report, the Audited Financial Statements of SFL is not yet ready. The initial investment made by the Company has been continued to be carried without adjusting for any loss or gain, due to aforesaid change. The same shall be considered, based on the Audited Financial Statements of SFL.

(04) The Company does not have any other subsidiary or Joint venture or Associate Company, within the meaning of the Companies Act, 2013.

(05) Relying on the Notification No. G.S.R. 723(E) dated the 14th October, 2014, issued by Ministry Of Corporate Affairs, by amending Rule 6 of the Companies (Accounts) Rules, 2014, [exempting company which does not have a subsidiary or subsidiaries but has one or more associate companies or joint ventures or both, for the consolidation of financial statement in respect of associate companies or joint ventures or both, as the case may be, for the financial year 2014-15], your company has not prepared the Consolidated Financial Statements for the year under report "

18. Segment Reporting

(01) The Company has two business segment (1) Manufacture and sale of steel forgings.(2) Land and Development described as "Other Operating Income" (Amount in Rs. Lakh)

(02) The Company is engaged in the business of manufacturing of Auto Ancillary part (Manufacture and sale of steel forgings). It is one of the reportable segments, as per AS 17. As the exports are mainly to Developed Countries, geographical risk is not different from domestic market and hence no separate secondary segment disclosure is required, in respect of the aforesaid reportable segments.