1.1 Corporate Information
Sarthak Metals Limited (hereinafter referred to as 'the Company') is a public company domiciled in India. Earlier, the Company was known as Sarthak Metals Marketing Private Limited. Its shares are listed on BES SME Stock Exchange. The company is engaged in the manufacturing and selling cored wires, ferro alloys, aluminium wire, industrial gases and related items.
(iv) The company has only one class of equity shareholders. Each shareholder is entitled to right of one vote per share.
(v) The company declares and pays dividend in Indian Rupees. Dividend proposed by directors is subject to approval of shareholders at the ensuing Annual General Meeting.
(vi) In the event of liquidation, equity shareholders shall be eligible to receive remaining assets of the company after distribution of all preferential amounts in proportion of their shareholding.
1. Term loan from State Bank of India was taken during the current financial year and carries effective interest @ 10.00% p.a. The loan is secured by hypothecation of plant and machinery of the Company. Further, the loan has been guaranteed by the personal guarantees of some of the directors of the Company.
2. Vehicle loans from banks is secured by hypothecation of respective vehicles of the Company.
1. Cash credit and Buyers' Credit from State Bank of India is secured against leasehold land, factory land and commercial office complex in the name of the Company. The cash credit is repayable on demand and carries effective interest @ 10.00% p.a. Further, the credit has been guaranteed by the personal guarantee of the directors of the Company.
2. Financing facility from Axis Bank is unsecured. The loan is repayable on demand and carries effective interest @ 9.00% p.a.
b. 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 on 31st March,2018 as micro, small or medium enterprises. Consequently the amount paid/payable to these parties during the year is Nil (previous year: Nil)
d. Earnings in foreign currency is Rs. 75 lacs (Previous year: Rs. 51.22 Lacs)
2. ENTERPRISES OVER WHICH SIGNIFICANT INFLUENCE EXISTS:
a. Metal Grace Injection Alloys Pvt. Ltd.
b. Bansal Brothers
c. M/s. Sarthak Energy Pvt.Ltd.
d. Previous year's figures are regrouped and reclassified to confirm to this year's classification, as per revised Companies Act, 2013.
e. Interest Subsidy of Rs. 15,382.00/- had been received from DIC
h. Year end cash balance and Closing stocks are taken as verified and represented by the management.
i. In the opinion of board, all current assets including sundry debtors, loans and advances, etc. are recoverable in the ordinary course of business and would realize the value as stated.
Further, in the opinion of board, the provisions for depreciation and all known liabilities are adequate and are not in excess of the amount reasonably necessary.
j. Parties' closing balances are subject to confirmation and /or reconciliation however, the Company has adopted a system to ascertain the balance confirmation on periodical basis and any consequential adjustments, presently unascertainable, shall be accounted for as and when these accounts are reconciled / settled.
l DEFERRED TAXES :
The Company follows the depreciation method as per the Companies Act 2013. Deferred tax has been worked out @ 33.063% on the Treatment of Depreciation under the Companies vis-a-vis the Income Tax Act. The Company has provided the Liability / Assets for Deferred Tax under the head Deferred Tax Liability. Accordingly the amount of Deferred Tax Liabilities is as follows:-
k. The Company has Rs. 16.27 Lac unrealised gains on foreign currency transactions as on 31st March 2018.
l. There is total long term borrowing as on 31st march 2018 is Rs. 227,77,255.42 out which installment payable within Twelve Months is Rs,125,27,965/- .
m. Since, company has earned average net profit before tax more than Rs 5 Crores in the last three years, provision for Corporate Social Responsibility is required to be made under Section 135 Of Companies Act, 2013. However, the provision has not been recognised in the FY 2018 Financial Results as the CSR Committee meeting of company was delayed and was conducted post the announcement of Financial Results. The amount recommended by the CSR committee for CSR provision is Rs 12.20 Lacs for FY 2017-18 which SML plans to expend in FY 2018-19 along with any unspent CSR provisions pertaining to earlier financial years.
n. The IPO Proceeds of company were used only for intended purposes as per the Prospectus of the Company. There is no deviation in the utilisation of IPO proceeds.
Note 3. - Employee Benefits Under AS-15
Employee Benefits
A. Provident Fund Contribution
The Company makes contribution to statutory provident fund in accordance with Employees Provident Fund and Miscellaneous Provisions Act, 1952. This is post-employment benefit and is in the nature of defined contribution plan. The contribution made by the Company during the year is Rs 13,87,342/- (previous year: Rs 7,82,174).
B. Gratuity*
The following table set outs the status of the gratuity plan as required under AS 15:
*In the previous year Company acknowledged the fact that the acturial valuation is applicable on the Company as per Accounting Standard-15 (Revised). Accordingly, the actuarial liability for gratuity was made in the previous year and actuarial liability for gratuity has been recognised for the previous years as part of prior period adjustment.
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