annual report 2011-12 - Heavy Engineering Corporation Limited

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ANNUAL REPORT 2011-12 service cost, if any, and as reduced by the fair value of plan assets, wherever applicable and actuarial gain / loss to the extent recognized in Profit & Loss Account. Actuarial gains and losses are recognized in the Profit and loss account to the extent it exceeds the unrecognized portion of transitional liability The transitional liability in respect of long term employee benefit is recognized as an expense on a straight line basis over a period of five years. Gratuity and Leave encashment are provided for on the basis of actuarial valuation made, based on the data of the Balance sheet date. 8 DEPRECIATION Depreciation on fixed assets is charged on straight line method as per the rates prescribed in the Schedule XIV of the Companies Act and in respect of additions to/ deductions from the fixed assets during the year; depreciation is charged on prorata monthly basis. Wherever breakup of foundation cost for plant and machinery and plant building is not available, depreciation is charged at the rate applicable to plant building. 9 SUNDRY DEBTORS This includes items billed at provisional rates pending finalization of prices and receipt of formal orders from customers and also value of dispatches which are unbilled after adjustment on pro-rata basis of advances/progress payments received against the relevant contract. 10 GRANT-IN-AID Government grants received against Voluntary Retirement Scheme are set off against related expenses. Unspent balances of Grants-in- Aid are carried forward to subsequent years under Head “Liabilities”. Grants received against other revenue are recognized as other income over the years to which it relates. 11 INVESTMENT Investment held/intended to be held over one year (i.e. being long term ) are valued at cost less provision for diminution in value other than temporary, while current quoted investments are valued at lower of cost or market value. 12 RESEARCH & DEVELOPMENT Major expenditure relating to Research & Development is charged to profit & loss account in the year of incurrence. However, expenditure on fixed assets relating to Research & Development is treated in the same way as other fixed assets. Depreciation on such fixed assets is shown along with other Research & Development Expenditure. 13 FOREIGN CURENCY TRANSACTIONS Monetary assets and liabilities relating to foreign currency transactions including deferred credit payments remaining outstanding at the Balance Sheet date are converted at year end rates. The differences in conversion of assets and liabilities and realized gains and losses on foreign exchange transaction during the year are accounted for in the Profit & Loss Account, except those relating to acquisition of fixed assets which are adjusted in the cost of fixed assets. 14 DEFERRED REVENUE EXPENDITURE To lump sum payment towards foreign collaboration in the form of technical know-how, documentation and reports for any product is treated as Deferred Revenue Expenditure, which is written off in five years. 15 CLAIM BY/AGAINST THE COMPANY (i) Liquidated damages payable as per contracts are accounted for on ascertainment and cases of specific damages and claims disputed by the company are provided for on reasonable estimate by the Company. (ii) Liquidated damages recovered are recognized as income after expiry of three years of recovery. (iii) Export incentives, Railways and Insurance claim sale of sundry disposable materials & certain scraps, refund of excise & custom duty and income from other similar items are accounted for on ascertainment of the amount and certainty of their realization / claim. 16 INTER PLANT COST ALLOCATION The following expenses are allocated in different Plants on the basis stated hereunder:- (a) HQRS expenses (Net) -Budgeted production of each Plant. (b) Township expenses (Net) - No. of quarters allotted to each Plant. (c) Interest - Actual cash utilization by each plant in the preceding year. (d) CISF expenses- No. of CISF personnel deployed in each Plant. 17 INVENTORY Non moving items of stores are analysed from time to time. Materials found surplus on physical verification are either disposed off or reviewed to find out alternative uses for the same. Loss, if any, is accounted for when it is ascertained. However non moving items for more than 3 years, the maximum provision, if required, is to be restricted to 90 % of value of inventory. 24
ANNUAL REPORT 2011-12 BALANCE SHEET AS AT 31ST MARCH 2012 ` in Lakhs Note No. AS AT 31.03.2012 AS AT 31.03.2011 I. EQUITY & LIABILITIES (1) SHAREHOLDER'S FUND (a) Share Capital 1 60607.88 60607.88 (b) Reserves & Surplus 2 (77633.67) (78024.54) (2) SHARE APPLICATION MONEY PENDING ALLOTMENT 0.01 0.01 (3) NON-CURRENT LIABILITIES (a) Other Long Term Liabilities 3 60900.12 57338.47 (b) Long Term Provisions 4 13882.67 12322.37 (4) CURRENT LIABILITIES (a) Short Term Borrowings 5 9440.88 8965.67 (b) Trade Payables 6 11265.00 12702.94 (c) Other Current Liabilities 7 10239.17 8704.24 (d) Short Term Provisions 8 5982.84 5204.35 II. TOTAL 94684.90 87821.39 ASSETS (1) NON-CURRENT ASSETS (a) Fixed Assets (i) Tangible Assets 9 5572.61 5700.36 (ii) Intangible Assets 10 151.42 305.55 (iii) Capital Work in Progress 11 2629.22 2537.37 (b) Non-Current Investments 12 0.36 0.36 (c) Long Term Loans & Advances 13 1429.37 1065.01 (d) Other Non-Current Assets 14 23216.76 29212.19 (2) CURRENT ASSETS (a) Inventories 15 27374.81 23455.37 (b) Trade Receivables 16 28724.78 20970.92 (c) Cash & Cash Equivalents 17 3136.30 2447.86 (d) Short Term Loans & Advances 18 2118.35 2042.84 (e) Other Current Assets 19 330.92 83.56 TOTAL 94684.90 87821.39 Notes on Account 29 Notes No 1 to 19 , 29 & Significant Accounting Policies form an integral part of the Balance Sheet. A.K.Kanth S.K. Chakraborty Kushal Saha R.Misra Company Secretary General Manager (Finance) Director (Production) & Chairman Cum Managing Director Director Mktg. (Additional Charge) In terms of our report of even date For Anjali Jain Associates, Chartered Accountants Place : Ranchi (ANJALI JAIN) Date : 6/9/2012 Partner, M No. 72022 25
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Page 28 and 29: OUR PROJECTS Conveyor System at New
Page 30 and 31: OUR PRODUCTS CNC Deep Hole Boring M
Page 34 and 35: ANNUAL REPORT 2011-12 STATEMENT OF
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Page 54 and 55: ANNUAL REPORT 2011-12 ANNEXURE - I
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