Annual Report FY 2010-11 - Pipavav Shipyard

Annual Report 2010-11
Schedules forming part of the Consolidated Balance Sheet and the Profit and
Loss account
SCHEDULE 20: SIGNIFICANT ACCOUNTING POLICIES
1. Principles of Consolidation :
The consolidated financial statements relate to the Pipavav Shipyard Limited (‘the Company’) and its subsidiary company.
The consolidated financial statements have been prepared on the following basis:
a. The financial statements of the Company and its subsidiary company are combined on a line-by-line basis by
adding together the book values of the like items of assets, liabilities, income and expenses, after fully eliminating
intra-group balances and intra-group transactions in accordance with Accounting Standard (AS) 21 – “Consolidated
Financial Statements”.
b. As far as possible, the consolidated financial statements are prepared using uniform accounting policies for like
transactions and other events in similar circumstances and are presented, in the same manner as the Company’s
separate financial statements.
c. The difference between the cost of investment in the subsidiary, over the net assets at the time of acquisition of
shares in the subsidiary is recognized in the financial statements as Goodwill, which is not being amortised.
2. Other significant accounting policies :
These are set out under “Significant Accounting Policies” as given in the Standalone Financial Statements of Pipavav
Shipyard Limited.
SCHEDULE 21: NOTES TO ACCOUNTS
1. Following subsidiary company is considered in the consolidated financial statements :
Name of the Subsidiary Country of Incorporation Proportion of ownership interest
E Complex Private Limited India 100%
2. Contingent Liabilities: 31.03.2011
(Rs. in Lacs)
31.03.2010
a) Guarantees given by Company’s Bankers
i) Refund Bank Guarantees given to customers (Net of liabilities
accounted for)
17,539.84 48,400.26
ii) Other Bank Guarantees
(Bank Guarantees are provided under Contractual/Legal obligations.
No cash outflow is expected).
9,065.85 7,597.99
b) Demands not acknowledged as Debts
i) Income Tax
(Out of total demand the Company has already deposited Rs.288.67
Lacs (P.Y. Rs. 21.17 Lacs) and no further cash outflow is expected in
the near future).
ii) Service Tax and excise duty
(Relates to disallowance of Cenvat Credit taken by the Company.)
iii) Other Claims
(Relates to claims of suppliers and demand raised by vendor for
service tax etc. No Cash Outflow is expected.)
c) Letters of Credit opened in favour of suppliers
(Cash Flow is expected on receipt of materials from Suppliers).
397.32 40.49
58.45 -
192.10 94.01
23,388.51 1,891.67
3. Estimated amount of contracts remaining to be executed on Capital Accounts and
not provided for (Net of Advances) (Cash flow is expected on execution of such
3,693.81 11,791.55
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Capital Contracts on Progressive basis)
91