COMPANY OVERVIEW
FRONTIER SPRINGS LIMITED is a Listed Public Limited
Company having its Registered office at KM-25/4 Kalpi
Road Rania Kanpur- Dehat and is mainly engaged in the
production of L.H.B. Springs, Hot Coiled Compression
Springs, Air-Springs and Forging items for Wagon,
Locomotives and Carriage and is regularly supplying to
Railways, Bogie Manufactures, Chittaranjan Locomotive
Works, Diesel Locomotive Works, Integral Coach Factory,
Rail Coach Factory. In addition to the supply to the Railways,
the Unit is also supplying the Springs to Heavy Engineering
Industries & original earth movers Equipment manufacturers
i.e. BEML, TELCON, Bharat Heavy Electricals Ltd.
Since last about 40 years FRONTIER SPRINGS LTD. is
registered with Research Designs and Standards Organisation
(RDSO- Ministry of Railways) for supply of springs to Indian
Railways and the unit has developed large number of Springs
as per the latest specification of the RDSO.
The Company has set up four plants to meet the demand
requirements of the above stated Industries at 1. Springs-
unit, KM-25/4, Rania Kanpur Dehat, 2. Air-Springs-unit,
KM-25/4, Rania Kanpur Dehat, 3. Springs-units,91/2, Kunja,
Paonta Sahib, Sirmaor Himanchal Pradesh 4. Forging Div. at
KM-25/4, Rania Kanpur Dehat.
1. Basis of Preparation of Financial Statements
(Ind AS 1)
The financial statements of the Company have been
prepared in accordance with Indian Accounting Standards
(Ind AS) notified under Section 133 of the Companies
Act, 2013, read with the Companies (Indian Accounting
Standards) Rules, 2015, as amended from time to time. The
financial statements have been prepared on an accrual and
going concern basis under the historical cost convention,
except for certain financial instruments measured at fair
values. All assets and liabilities have been classified as current
or non-current as per the Company's normal operating cycle
and other criteria set out in Ind AS 1 and Schedule III to the
Companies Act, 2013. The financial statements also comply
with Indian Generally Accepted Accounting Principles
(GAAP) under the historical cost convention on the accrual
basis except for certain financial instruments which are
measured at fair values. GAAP comprises mandatory
accounting standards as prescribed by the Companies
(Accounting Standards) Rules, 2006 and guidelines issued
by the Securities and Exchange Board of India (SEBI).
2. Use of Estimates and Judgements (Ind AS 1 &
Ind AS 8)
The preparation of financial statements requires
management to make judgements, estimates and
assumptions that affect the reported amounts of revenues,
expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities.
Actual results may differ from these estimates. Estimates
and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognized in
the period in which the estimate is revised and in any future
periods affected.
3. Property, Plant and Equipment (Ind AS 16)
Property, Plant and Equipment are stated at cost, net of
accumulated depreciation and impairment losses, if any.
The cost includes expenditure directly attributable to the
acquisition of the asset. Subsequent costs are included in
the asset's carrying amount only when it is probable that
future economic benefits associated with the item will
flow to the Company. Depreciation on assets is provided
on a straight-line basis over the useful life as prescribed
in Schedule II of the Companies Act, 2013, or based on a
technical evaluation. The residual values, useful lives and
methods of depreciation are reviewed at each financial year
end and adjusted prospectively, if appropriate. net charges
on foreign exchange contracts and adjustments arising from
exchange rate variations attributable to the fixed assets are
capitalized.
4. Leases (Ind AS 116)
The Company assesses whether a contract is or contains a
lease, at inception. A right-of-use asset and a lease liability
are recognized at the lease commencement date. The right-
of-use asset is initially measured at cost and subsequently
no depreciation is charged being a lease hold land allotted
by U.P.S.I.D.C. situated at E-14, Panki Industrial Area, Site
no.1, Kanpur -208022. As informed by the management.
5. Intangible Assets (Ind AS 38)
The Company does not have any intangible assets as at the
reporting date. This conclusion is based on an evaluation
that no identifiable non-monetary assets without physical
substance exist that meet the recognition criteria laid down
under Ind AS 38, including control over the asset, expected
future economic benefits, and reliable measurement of cost.
6. Depreciation and Amortisation (Ind AS 16 &
Ind AS 38)
Depreciation on tangible fixed assets is provided on a straight¬
line basis over the estimated useful lives. Depreciation for
assets purchased/sold during a period is proportionately
charged. Individual assets costing less than INR 5,000 are
fully depreciated in the year of acquisition. Useful lives are
reviewed periodically.
7. Impairment of Assets (Ind AS 36)
The Company assesses at each reporting date whether
there is any indication that an asset may be impaired. If any
such indication exists, the recoverable amount of the asset is
estimated. An impairment loss is recognized for the amount
by which the asset's carrying amount exceeds its recoverable
amount. Reversal of impairment loss is recognized when the
reasons for impairment cease to exist.
As informed by the Management, there is no indication of
impairment in assets. (as it occurs where carrying value
exceeds the present value of future cash flows expected to
arise from the continuing use of the assets and its eventual
disposal).
8. Foreign Currency Transactions (Ind AS 21)
Transactions in foreign currencies are initially recorded by
the Company at the exchange rates prevailing at the date of
the transaction. Monetary assets and liabilities denominated
in foreign currencies are translated at the functional currency
spot rates of exchange at the reporting date. Exchange
differences arising on settlement or translation of monetary
items are recognized in profit or loss. please refer to the
note number 29(3).
9. Investments (Ind AS 109 & Ind AS 32)
Trade investments are the investments made to enhance the
Company's business interests. Investments are classified as
either measured at amortized cost, fair value through profit
or loss (FVTPL), or fair value through other comprehensive
income (FVOCI), depending on the Company's business
model and the contractual cash flow characteristics. Long¬
term investments are carried at cost less provision for
diminution, other than temporary.
10. Inventories (Ind AS 2)
Inventories are valued at the lower of cost and net realizable
value. Cost includes all expenses incurred in bringing the
inventories to their present location and condition and
is determined on a FIFO basis. Net realizable value is the
estimated selling price in the ordinary course of business,
less estimated costs of completion and the estimated
costs necessary to make the sale. Work in Process is valued
at conversion cost exclusive of GST/Excise duty, Scrap are
valued at Net Realisable value and Finished goods are valued
at Net Realisable value.
(ii) Valuation of Closing Stock of Finished Goods & Scrap:
Closing stock of Finished Goods & Scrap amounting to
' 2,01,17,542.00 (Pre.Yr. ' 1,18,56,027.00 of closing
stock of finished goods & scrap).
11. Revenue Recognition (Ind AS 115)
Revenue is recognized when control of the goods or services
is transferred to the customer at an amount that reflects the
consideration to which the Company expects to be entitled.
Revenue from the sale of goods is recognized when delivery
is made. Other income is recognized on an accrual basis. It
is further recognized when it can be reliably measured and
it is reasonable to expect ultimate collection. Revenue from
operations includes sale of goods, sales tax, service tax,
excise duty, GST and sales during trial run period, adjusted
for discounts (net), Value Added Tax (VAT) & GST and gain/
loss on corresponding hedge contracts. Dividend income
is recognized when right to receive is established. Interest
income is recognized on time proportion basis taking into
account the amount outstanding and rate applicable.
12. Taxes on Income (Ind AS 12)
Tax expense comprises current and deferred tax. Current
tax is based on the taxable income for the year. Deferred
tax is recognized using the balance sheet approach, on
temporary differences between the tax bases of assets and
liabilities and their carrying amounts. Deferred tax assets
are recognized only to the extent it is probable that taxable
profits will be available.
13. Employee Benefits (Ind AS 19)
The Company provides for gratuity (defined benefit plan)
and provident fund (defined contribution plan). The liability
for gratuity is determined on the basis of actuarial valuation
using the projected unit credit method. Re-measurements
are recognized in other comprehensive income and are not
reclassified to profit or loss in subsequent periods.
Retirement Benefits to employees:
Gratuity
In accordance with the Payment of Gratuity Act, 1972, the
Company provides for gratuity, a defined benefit retirement
plans ('the Gratuity Plan') covering eligible employees.
The Gratuity Plan provides a lump-sum payment to
vested employees at retirement, death, incapacitation or
termination of employment, of an amount based on the
respective employee's salary and the tenure of employment
with the Company.
Liabilities with regard to the Gratuity Plan are determined
by actuarial valuation at each Balance Sheet date using
the projected unit credit method. The Company fully
contributes all ascertained liabilities to the Frontier Springs
Limited Employees' Gratuity Fund Trust (the Trust). Trustees
administer contributions made to the Trust and contributions
are invested in specific investments as permitted by the
law. The Company recognizes the premium payable on
account of said policy is charged to profit & loss account,
respectively in accordance with Accounting Standard (AS)
15, 'Employee Benefits'.
Provident fund
Eligible employees receive benefits from a provident fund,
which is a defined benefit plan. Both the employee and the
Company make monthly contributions to the provident
fund plan equal to a specified percentage of the covered
employee's salary.
The Company's contribution to Provident Fund and Family
Pension Fund is charged to Profit & Loss account
Employee Separation Costs
Compensation if any paid to employees who have opted for
retirement from the Company is charged to the Profit and
Loss account in the year of exercise of option.
14. Borrowing Costs (Ind AS 23)
Borrowing costs that are directly attributable to the
acquisition or construction of a qualifying asset are
capitalized as part of the cost of the asset. All other
borrowing costs are expensed in the period in which they
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