MPF Systems Limited (previously known as Mather and Platt Fire Systems Limited) ('the Company') was formed as a result of a demerger of Mather and Platt (India) Limited on 18 April 2001. Consequently the business of fire systems was transferred to the Company. Pursuant to the Share Purchase Agreement dated July 01, 2014, the Company has taken on record the transfer of 1,887,697 equity shares of Rs. 10 each held by Wilo Se (the erstwhile holding company), representing 55.48% of the issued, subscribed and paid-up equity share capital of the Company, to Royal Nirman Private Limited; resulting in change of control in the Company. The Company is primarily engaged in the business of design, development, installation and servicing of Fire Securities systems. The Company has its corporate office at Chinchwad (E), Pune. Currently there are no commercial operations carried out by the Company.

2. Going concern

The Company has incurred loss during the year and the total accumulated losses at that date amounting to INR 34,542,585 indicate a complete erosion in the Company's net worth as of 31 December 2014. However management believes that the Company will be able to continue operations on a going concern basis and meet all its liabilities as they fall due for payment in the foreseeable future on the basis of the financial support from the Holding Company, Royal Nirman Private Limited. The Holding company has agreed to provide necessary financial support to meet the liabilities of the Company till 31 December 2015. In this regard, the Company has received a letter dated 27 February 2015 from the Parent Company confirming that they will provide the necessary financial support till 31 December 2015.

Accordingly, these financial statements do not include any adjustments relating to the recoverability and classification of the carrying amount of assets or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

3. Rights, preferences and restrictions attached to equity shares

The Company has only one class of shares referred to as equity shares having a par value of Rs. 10. Each holder of equity shares is entitled to one vote per share. Accordingly, all equity shares rank equally with regards to dividends and shares in the Company's residual assets. On winding up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company after distribution of all preferential amounts in proportion to the number of equity shares held.

Sub Note : Pursuant to the resolution passed by the Board of directors in their meeting held on October 26, 2013, the Company had sold its intangible fixed assets comprising copyrights, knowhow, qualification rights and trademarks pertaining to Fire and Security Engineering Division of Mather and Platt (India) Limited which were initially transferred to the Company pursuant to Scheme of Arrangement with Mather and Platt (India) Limited as approved by the Honorable High Court of Bombay vide its order dated April 18, 2001. These intangible assets were at Nil value in the books.

The consideration for sale of these intangible assets is based on valuation made by an independent valuer.

4. Contingent liabilities

a) Claims against the Company not
acknowledged as debts                      3,778,847          3,778,847

b) Sales tax and Works Contract tax*       7,432,727          7,432,727
                                          11,211,574         11,211,574

5. Creditors scheme of arrangement

The Company's Scheme of Arrangement with its Unsecured creditors had been approved by the Honorable High Court of Judicature at Bombay vide Order dated 30th April, 2007. Unsecured Creditors had exercised the options for settlement of their claims and the Company has disbursed all the installments to creditors covered under the scheme. However, certain cheques amounting to Rs. 860,233 had been returned back and balance equivalent to cheques returned back had been maintained in a bank account with a scheduled bank. Reduction of principal value of liabilities arising out of the compromise/ arrangement under the scheme credited to Capital Reserve, had been set off against the loss in the previous years, in accordance with accounting treatment prescribed under clause 5 of the Scheme of Arrangement as approved by the Hon'ble High Court of Judicature at Bombay vide Order dated 30 April 2007.

6. Compliance with Micro, Small and Medium Enterprises Development Act, 2006 ('the MSMED Act')

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any relating to amounts unpaid as at the period end together with interest paid / payable as required under the Act are not applicable.

7. Segmental Information

The Company is primarily engaged in the business of design, development, manufacture, installation of fire securities systems. As such, there is no separate reportable segment as per the Accounting Standard - 17 "Segment Reporting". All the activities of the Company are carried out in India.

8. Deferred taxation

As at the year end, the Company has assessed the realisability of the deferred tax assets on carry forward loss for the year and has determined that there is no virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realized and therefore it has not created any deferred tax asset.

9. Disclosure of related parties / related party transactions:

a) List of related parties where control exists

Sr. No. Name of the Related Party Relationship

1        WILO SE , Germany *               Holding Company - upto 30
                                           June 2014

2        Royal Nirman private limited*     Holding Company - from 1
                                           July 2014

b) Notes to related party transactions:

(i) Orders, invoicing and other matters relating to the operations of the Company, are being presently done / dealt with in the name of Mather and Platt (India) Ltd. wherefrom the Company demerged, pending completion of various formalities in this regard.

(ii) The Company had no staff, and the operations of the Company were supported by Wilo Mather and Platt Pumps Private Limited (previously known as Mather and Platt Pumps Limited) upto 30th June 2014, free of charge.

10. Company Secretary

The financial statements have not been authenticated by a whole time secretary as required under Section 215 (1) of the Companies Act, 1956, as the Company has not appointed a whole time Company Secretary.