Annual Report cb smile - Jet Airways

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Significant Accounting Policies and Notes to Accounts (contd.) b) Redelivery of Aircraft : The Company has in its fleet aircraft on operating lease. As contractually agreed under the lease agreements, the aircraft have to be redelivered to the lessors at the end of the lease term in the stipulated technical condition. Such redelivery conditions would entail costs for technical inspection, maintenance checks, repainting costs prior to its redelivery and the cost of ferrying the aircraft to the location as stipulated under the lease agreement. The Company therefore provides for such redelivery expenses, as contractually agreed, in proportion to the expired lease period. Amount (Rs. in lakhs) Particulars 2009-10 2008-09 Opening Balance 3,031 2,115 Add:- Additional Provisions during the year* 315 1,441 Less:- Amounts used during the year 753 525 Less:- Unused Amounts reversed during the year - - Closing Balance 2,593 3,031 * Additions include adjustment of Rs. (394) Lakhs (Previous Year Rs. 579 lakhs) on account of exchange fluctuation consequent to restatement of liabilities denominated in foreign currency. The cash outflow out of the above provisions as per the current terms under the lease agreements are as under:- Year 2009-10 2008-09 Aircraft Amount Aircraft Amount (Rs. in lakhs) (Rs. in lakhs) 2010-11 3 256 4 394 2011-12 2 205 1 87 2012-13 18 1,493 17 1,286 2014-15 3 130 3 106 2015-16 13 425 13 269 2017-18 3 20 - - 2018-19 3 50 3 12 2019-20 2 14 - - Total 2,593 2,154 c) Aircraft Maintenance Costs : Certain heavy maintenance checks including overhaul of Auxiliary Power Units need to be performed at specified intervals as enforced by the Director General of Civil Aviation in accordance with the Maintenance Program Document laid down by the manufacturers. The movements in the provisions for such costs are as under: - Amount (Rs. in lakhs) Particulars 2009-10 2008-09 Opening Balance 3,433 4,217 Add/(Less) :- Adjustments during the year * (268) 1,048 Less: - Amounts used during the year (1,230) 1,633 Less: - Unused Amounts reversed during the year (166) 199 Closing Balance 1,769 3,433 * Adjustments during the year represents exchange fluctuation impact consequent to restatement of liabilities denominated in foreign currency. 78
Significant Accounting Policies and Notes to Accounts (contd.) d) Engine Repairs Cost : The aircraft engines have to undergo shop visits for overhaul and maintenance at specified intervals as per the Maintenance Program Document. The same was provided for on the basis of hours flown at a pre-determined rate. Amount (Rs. in lakhs) Particulars 2009-10 2008-09 Opening Balance 333 657 Add/(Less) :- Adjustments during the year * (6) 164 Less: - Amounts used during the year 327 372 Less: - Unused Amounts reversed during the year - 116 Closing Balance - 333 * Adjustments during the year represents exchange fluctuation impact consequent to restatement of liabilities denominated in foreign currency. 16) In the previous year, the Company adopted the option offered by the notification of the Companies (Accounting Standards) Amendment Rules, 2006 which amended Accounting Standard - 11 “The Effects of Changes in Foreign Exchange Rates”. Pursuant to the aforesaid notification, exchange differences relating to long term monetary items have been accounted for as described in Accounting policy L of Schedule S. Accordingly, cumulative foreign exchange loss (net) of Rs. 94,895 lakhs (Previous year Rs. 215,556 lakhs) has been adjusted to the cost of the fixed assets/capital work-in-progress being the exchange differences on long term monetary items relatable to the acquisition of fixed assets. As a result of this the net loss before tax for the year is higher by Rs. 120,661 lakhs and Previous Year was lower by Rs. 239,001 lakhs. 17) The Company has entered into a “Power by the Hour” (PBTH) Engine Maintenance agreement with a Service provider for its Next Generation Boeing 737 Aircraft fleet. Till the previous year, with respect to all Aircraft on operating lease, the company was charging variable rent payable to various Lessors to the profit and loss account as per the agreement entered into with them. Consequent to the new arrangement entered into with the Engine Maintenance Service provider, which includes the cost of future engine shop visits, the Company has expensed out the monthly cost of PBTH at the rate specified in the contract to the profit and loss account and treated the variable rental payable to the Lessors as receivables to be set off against the future claims payable on engine shop visits. Accordingly, the variable rent of Rs. 9,712 lakhs for the year ended 31st March, 2010 has been reflected as “Receivable from Lessors” and classified under “Loans and Advances”. 18) Disclosures relating to amounts payable as at the year end together with interest paid / payable to Micro, Small and Medium Enterprises have been made in the accounts, as required under the Micro, Small and Medium Enterprises Development Act, 2006 to the extent of information available with the Company determined on the basis of intimation received from suppliers regarding their status and the required disclosure are given below: Amount (Rs. in lakhs) Particulars 2009-10 2008-09 a Principal amount remaining unpaid as on 31 st March, 2010 30 113 b Interest due thereon as on 31st March, 2010 - - c Interest paid by the Company in terms of Section 16 of Micro, Small and Medium Enterprises Development Act, 2006, along with the amount of the payment made to the supplier beyond the appointed day during the year. - - 79
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Letter from the Chairman The year 2
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Letter from the Chairman (contd.) n
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Financial Highlights 200000 175000
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Corporate Information Board of Dire
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Notice Notice is hereby given that
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Notice (contd.) RESOLVED FURTHER TH
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Notice (contd.) Notes : 1. A MEMBER
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Notice (contd.) f) Ensure that the
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Notice (contd.) MAG has been incorp
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Directors’ Report Dear Members, Y
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Directors’ Report (contd.) The de
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Directors’ Report (contd.) 8. Con
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Directors’ Report (contd.) Due to
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Management’s Discussion and Analy
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Management’s Discussion and Analy
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Corporate Governance Report (As req
Page 36 and 37: Corporate Governance Report (contd.
Page 48 and 49: Auditors’ Report To, The Members
Page 50 and 51: Annexure to the Auditors’ Report
Page 52 and 53: Balance Sheet as at 31 st March, 20
Page 54 and 55: Statement of Cash Flow for the year
Page 56 and 57: Schedules to the Balance Sheet as a
Page 64 and 65: Schedules to the Profit and Loss Ac
Page 66 and 67: Significant Accounting Policies and
Page 90 and 91: Statement pursuant to Section 212 (
Page 92 and 93: Auditors’ Report on Consolidated
Page 94 and 95: Consolidated Balance Sheet as at 31
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Page 98 and 99: Schedules to the Consolidated Balan
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Page 130 and 131: City Facts (contd.) Chennai Airport
Page 132 and 133: City Facts (contd.) Port Blair Airp
Page 134 and 135: City Facts (contd.) Dubai Airport:
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Annual Report cb smile - Jet Airways

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