India Cements Ltd. - Quarterly/Annual Result Disclosures and Notes dated 31 Mar 2018
Auditor and Management Disclosures and Notes for the annual results dated 31 Mar 2018
1. The above Financial Results have been reviewed by the Audit Committee and approved by the Board of Directors at the meetings held on 25th May 2018.
2. The Company is primarily engaged in manufacture and marketing of cement. Subsidiaries and Associate companies are mainly engaged in the business of Sugar, Power, Financial Services, Trading, Mining and Transportation, etc.
3. Till 30-June 2017,Excise Duty recovered from Sale of excisable goods was included in Revenue from Operations and the Excise duty paid was included in Other Expenditure 4(i). Consequent to introduction of GST (Goods and Services Tax) from 1st July 2017,as the Excise Duty is subsumed under GST,the said income and expenditure from July 1, 2017 are net of GST and hence not comparable.
4. The Scheme of Amalgamation and Arrangement between Trinetra Cement Limited and Trishul Concrete Products Limited ,collectively called Amalgamating Companies, with the Company is now complete in all respects. Consequently the financial statements for the year ended March 31, 2017 and the subsequent financial periods include those of the amalgamating Companies.
5. a) The Board of Directors has granted, as on 01.04.2017, 18.35 lakhs options to eligible employees under Employees Stock Option Scheme, 2016 (Scheme). The options granted under the Scheme will vest with the employees on 01.04.2018 and the vested options shall be exercised within one year from the date of vesting. On exercise of each option, one equity share of Rs.10/- each fully paid-up will be allotted at a price of Rs.50/- per share, including a premium of Rs.40/- per share. The difference between the fair market value and the grant price of Rs.50/- per share aggregating to Rs.4.78 Crores has been absorbed in the financials for the current quarter. (For the year Rs 20.60 Crores). Out of the Options granted, 709500 Equity shares of Rs.10/- each fully paid up, were allotted on 2nd May 2018.
b) Pursuant to a change in the compensation policy to Managerial Grade employees, the company has revised the policy on encashment of accumulated leave with effect from 01-01-2018. This has resulted in reduction of provision for unavailed leave balance as at 31-03-2018 and also resulted in lower expenditure on manpower costs during the year.
6. The Enforcement Directorate Authorities had issued an attachment order under the Prevention of Money Laundering Act, 2002 (PMLA) attaching certain assets of the Company for an aggregate carrying value of Rs.120.34 Crores. The Company, has already appealed against the said Order and the matter is presently Sub judice. (Without qualifying their report, the Auditors have drawn attention to this matter).
7. The Competition Commission in common with few other Companies imposed a penalty of Rs.187.48 Crores on the Company based on a Complaint filed by the Builders Association of India alleging cartelization and abuse of dominance. The Competition Appellate Tribunal allowed the appeal by the Company and remanded the same to Competition Commission for a fresh enquiry. The Competition Commission which heard the matter afresh on remand, imposed a penalty of Rs.187.48 crores by its Order dated 31.08.2016. Based on legal advise, the Company filed an appeal before the Competition Appellate Tribunal, New Delhi. The Company had deposited Rs.18.75 Crore, based on the interim Order passed by the Tribunal as a condition precedent for grant of stay of penalty imposed, the said payment has been grouped under Advances. In view of the appeal and based on expert legal opinion, no provision has been made in the above Financial Statements. (Without qualifying their report, the Auditors have drawn attention to this matter) .
8. The figures for the quarter ended 31.03.2018 and 31.03.2017 are the balancing figures between audited figures in respect of the full financial year and year to date figures upto the third quarter of the relevant financial year.
9. The previous periods’ figures have been regrouped to conform to current periods’ required classification.
10. The Board of Directors has recommended a dividend of Re. 0.80 per share for the year ended 31.03.2018 (previous year : Re.1/- per share). Upon approval by the shareholders at the ensuing Annual General Meeting, the dividend for the year ended Mar 31, 2018, will be met out of surplus in Statement of Profit & Loss in the Balance Sheet.