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1
CONTENTS
1. Board of Directors 2
2. Senior Management 3
3. Statement to Shareholders by CMD 4
4. Notice of AGM 10
5. Directors Report 11
6. Auditors’ Report 68
7. Balance Sheet 80
��� �������� ����������� ��
9. Cash Flow Statement 82
2
BOARD OF DIRECTORS
(As on 27th September, 2012)
Shri M.S. Rana Chairman and Managing Director
Shri K. Skandan Additional Secretary,
Ministry of Home Affairs
Shri H. Pradeep Rao Joint Secretary and Financial Adviser,
Ministry of Finance
Smt. K.J. Udeshi Director (RBI Nominee)
����������������������� �������������������������!����"���#!����$�Ministry of External Affairs
Smt. Meera Handa Deputy Director General (Philately),
Department of Posts
Shri Ashwini Kumar Director (Technical)
Dr. Manoranjan Dash Director (HR)
3
SENIOR MANAGEMENT
(As on 27th September, 2012)
Shri B. Burman General Manager,
Bank Note Press,
Dewas
Shri Sudhir Sahu General Manager,
Security Paper Mill,
Hoshangabad
Shri Ajay Kumar Srivastava General Manager,
Indian Government Mint,
Hyderabad
Shri N.J. Sunny General Manager,
Security Printing Press,
Hyderabad
Shri M.C. Bylappa General Manager,
India Government Mint,
Kolkata
�������%�� ����� ����!�&����'���(��$India Government Mint,
Mumbai
Shri K.K. Prasad General Manager,
India Security Press,
Nashik Road
Shri T.R. Gowda General Manager,
Currency Note Press,
Nashik Road
Shri S.P. Verma General Manager,
India Government Mint,
Noida
Shri Ramakant Dixit General Manager (Information Technology)
Shri A.K. Ray CVO (In-charge)
STATUTORY AUDITORS
M/s. Serva Associates
Chartered Accountants
New Delhi
ASSISTANT COMPANY SECRETARY
Shri Sachin Agarwal (FCS)
4
STATEMENT TO SHAREHOLDERS BY
M.S. RANA, CHAIRMAN AND MANAGING DIRECTOR
DURING THE 7TH AGM HELD ON 27TH SEPTEMBER, 2012
Ladies and Gentlemen,
On behalf of the Board of Directors and on my behalf, I would
like to extend a very warm welcome to all of you to the 7th
Annual General Meeting of the Security Printing and Minting
���"������ �!� )���� �*���� �����) ��� +��� ������ �!��&�$�Directors Report and Audited Accounts for the year ended
31st March, 2012 are already with you and with your permission,
I take them as read.
OPERATIONAL PERFORMANCE
Its my pleasure to inform that production achieved by India Government Mints in
2011-12 of 6282 mpcs of circulating coins is the highest ever in the history of Mints. Your
Company’s two Bank Note Presses produced 6541 mpcs of Bank Notes during 2011-12
which is 19.5% higher than last year. The Security Paper Mill, Hoshangabad produced
2925 MT of CWBN paper during 2011-12 which is ever highest. ISP Nashik has produced
SPUs of 49822 mpcs which is 31.2% higher than the last year.
FINANCIAL PERFORMANCE
Your Company’s sales turnover for the year increased to ` 3422.68 crore as against
` 3134.57 crore last year. PAT during the year increased to ` 582.46 crore as against
` 577.19 crore during the previous year. The PAT per employee has increased to ` 4.54
lakh resulting into an increase of 6% over the last year.
DEBT FREE COMPANY
Your Company has paid during March 2012 the last instalment of ` 175 crore of the
working capital loan of ` 700 crore taken from Ministry of Finance during corporatisation.
%�;�����) ����<���*�����<�!������*"����+�����*"�����������������=����!�` 2370.33 crore as on 31st March 2012.
MOU PERFORMANCE
Your Company had achieved for the 2nd time the “Excellent” rating in MoU for the year
2010-11. The Company has met maximum of the MoU targets for 2011-12 and its
performance is poised for achieving “Excellent” rating for the third year in succession.
5
DIVIDEND
+�������������=������**���������'���=������>?AB��!�"���C�"������!������*"���for the year 2011-12 aggregating to ` 116.49 crore. In the year 2010-11 your Company
had paid the maiden dividend of ` 115.44 crore.
AWARDS
Your Company has been awarded Performance Excellence Award-2011 in Golden
Enterprise category by Indian Institution of Industrial Engineering (IIIE), Mumbai for its
�����'�����"�����'�"��!��*�����D���%��������$�E�;�����<����;��������National Safety Award for the performance year 2010 by Directorate General of Factory
��=�������=������� <����)������$����������!� <������F*"'��*��$�&�=���*����!�India.
India Security Press, Nashik has been declared winner in Maharashtra Safety Awards
competition-2011 for longest accident free period in the group of light engineering
industries (Factories working over one million man-hours), by National Safety Council,
Maharashtra Chapter, Mumbai. SPM, Hoshangabad has been awarded the 1st Prize by
Nagar Rajbhasha Karyanvyan Samiti, Hoshangabad for the outstanding work done in
Hindi. BNP, Dewas bagged the 2nd�"��G���!�����'�H������I�(����!��*�+�;��#!���'� �(�(��)*"'�*��������**�����+# )���D��"'$�����*"'�*�������!����IJ<����for the year 2009-10.
MODERNISATION / INDIGENISATION
Your Company has a capex plan of ` 2500 crore out of which your Company has spent
about ` 130 crore during the year. After completion of phase–I modernization of Mints at a
cost of ` 200 crore, phase-II modernisation of Mints has been taken up at an approximate
cost of ` 80 crore. The modernisation has resulted in increased capacity and quality of
the coins being produced.
One new Bank Note printing line in place of the old printing line has been commissioned in
BNP Dewas. With this, the Bank Note printing capacity and capability for anti-counterfeiting
of the Bank Notes has improved considerably.
The foundation stone of a new CWBN Paper machine at SPM, Hoshangabad has been
laid during the year. The combined capacity of Joint Venture Paper Mill at Mysore and that
of SPM Hoshangabad when commissioned in 2014, will lead to indigenous production of
major requirement of CWBN paper as against major portion being imported at present.
A new Bank Note processing system BPS-2000 has been installed in CNP, Nashik leading
to improvement in the quality of the Bank Notes. State-of-art CAD and CTOP system
has been installed in the Currency Presses, thus, enhancing the capability in designing
��K�!K�����������%�����#�����;���*���"��������(�����������(�'�������<����installed in SPP, Hyderabad for on line numbering of printed stock.
6
CORPORATE SOCIAL RESPONSIBILITY
����) � ��� �"��� ` 4.36 crore during the year on various CSR projects as against
the MoU target of ` 3.00 crore. A MoU with Bharti Foundation was signed to promote
education in the rural areas with special focus on the girl child. About 1000 students are
studying in these schools comprising about 51% girls. This is a unique CSR initiative of
����) ���������������������;��������<����=�����������!�'����"�"�'����������
MoEF while granting Environmental Clearance for the New CWBN Paper line in SPM
Hoshangabad has put a condition that 5% of the total cost of the project shall be earmarked
towards CSR based on local needs. A reference to MoEF through MoF will be made to
reconsider the above condition as it will increase the project cost substantially.
)��������$�����) ���������"�=��������I�"��J���������������!�!*�'��;�'!��$�health, rain-water harvesting, sanitation, renewable energy, roads, water supply and skill
enhancement of the MSME personnel etc. All the CSR projects mentioned above have
gone through the process of baseline survey and were duly monitored and evaluated by
independent consultants.
STRENGTHENING OF VIGILANACE SET UP
Due to systematic institutional improvements carried out as part of strengthening of the
vigilance set-up, there has been a discernible improvement in following rules, procedures
���(����'�������'��(���"������*����+�����(��!��!���'�����=�(�'�����!!����<����taken-up to enhance their capacity in implementation of CVC guidelines. The net result
of preventive vigilance initiatives has been reduction in complaints, increased follow up
�!�����*���"��������������<���(��(����*�������"�����$������*������!���������������) L���"�������
INCREASED TRANSPARENCY
A new Procurement Manual examined by CVC and approved by the Board was released
by the then Hon’ble Union Finance Minister in May 2011. This manual wherever possible,
adapted and expanded upon the best practices from existing Public Procurement
���'�������C����=�������(����<�����������������������!���'�� ��=�'=��� ��� ���procurement of raw materials & machinery. The adoption of this Procurement Manual
���<���(����(������ �*"��=�*��� ���"������*���"����������+���"��'��!� )��(����Monitors after security clearance from MHA has been approved by CVC. The integrity
pact will be implemented in future contracts beyond the threshold value.
CUSTOMER SATISFACTION
In pursuit of achieving excellence in the delivery of its products and services, your
Company has conducted customer satisfaction survey through independent consultant
!����������;�����;��'��������!�����(��"�*������!���M�<�;��������) ����
7
MoF. As per the survey, the overall customer satisfaction rating for the six major security
product categories is ‘Excellent’. It shall be our endeavour to further improve the customer
satisfaction in the years to come.
ECO-FRIENDLY OPERATIONS
����) L��''���������)�#�NAAA��������������C�������=��'����<�����)�#��OAA��!���better environment management of their operations. These six units have implemented
F������������"����������"��J���!�������'�G�����!�������!P����;�����������Q����reduction in intake of fresh water from Narmada river for SPM, Hoshangabad is under
advanced stage of commissioning. Rain water harvesting projects have been taken up
in ISP Nashik and BNP Dewas. Replacement of existing tube lights and mercury lamps
;���+KR� �<�� '�(��� ��� �S �� �=�� <���� ���� <�� ���$� T����<�� ��� )&�$� %�������"���=�'���D%��E�;��������������"����������(�������*"����<��*����������!����existing air conditioning system.
CORPORATE GOVERNANCE
All the information as required to be placed as per DPE guidelines on corporate governance
were placed before the Board. Your Company has duly constituted Audit Committee &
I�*����������**�����������<�����)���"������E��������+�����*"'�������������has been obtained from the practicing Company Secretary regarding compliance of the
(����'�����������"����&�=�������<������) �!����������?A��K�?$�;�����������C��������E��������I�"����S�������������������������$���&�����������%) ���**����!���review of the Annual Accounts of the Company.
NEW PRODUCTS
New series of coins with ` symbol and having better designs and lustre have been
launched during the year. New Bank Notes with ` symbol are being gradually introduced.
SPP, Hyderabad has taken up printing of excise labels for Delhi Government and D-patta
!��*�$� '��� �'�(�<�'��� ����$� ���� !��� ����� &�=���*���� )��$� %����� ��� "������ ���I�=����� ��������$� ������� U�+� ��������� ��� #����� �����"�� !��� ������"'�Corporation Nashik.
R&D
During the year the Company has spent ` 4.63 crore on R&D activities against the MoU
target of `�V�WR��������X������*"�����������"�""'����I�E�"��J��� ��� �����'���!�security paper, security printing, Bank Note printing & coin metallurgy. The Company is
setting up R&D centres across all production verticals. It will help the Company to bring
*��������(���������������"�����������!��������������"���������"���������
8
ERP
X������*"��� ��� �*"'�*����(����KFI��������''� ��������������!�����) ���� !�''��!������'�+���KV�E������� ����"����(�� )&�$�%���������) � ���'�������(��"��E������I���=�����������)&�$�T����<��;�������������'��(����!�����(��������testing. As on date, the ERP system has been nearly implemented across all the units and
�������<�'������"�����+����;�''������'������������"�����$��!����������������*��but will also help in achieving the desired goals with relative ease and simplicity.
HUMAN RESOURCE
The overall industrial relations scenario during the year was cordial and peaceful. Training
of the workmen, supervisors & executives has been taken as a thrust area. The elections
to the EPF Trust has been conducted successfully during the year 2011-12. Employee
strength as on 31st March, 2012 has come down to 12818 as against about 18000 at the
time of corporatisation in 2006.
BUSINESS SCENARIO
RBI in its latest forecast has indicated enhanced indents for Coins and Bank Notes in
�����C��=��������+����;�''���Q�������������(�����"�����!�������������!����D���Note Presses by replacing old machines and also purchasing new machinery wherever
required. The printing capacity of Currency Presses may be required to be further
increased as and when new security features are introduced.
)�������!�FK"��"��$�����) �������''���*��������<�����"��J��������'���"�!���Q����some time due to delay in security clearance of vendors. This segment has potential for
��������� ��=����� ������) ������ ���"��J��� �����!!��+�����*��� !��� "��'� ���NJSP products is decreasing due to technological changes. To diversify, ISP Nashik and
SPP, Hyderabad have ventured into new security products as mentioned earlier.
+�����'�������'�������!��'��"�������!������$�D���%���$�������'�"��������������(�������<'���������������"�'��*"'�����������) ���*����������!����������+���payment of `��?AAK�RAA�������<����S�������) ���"��������"����(���*����!�?AA�$�in the form of equity or any other form is still due.
However, it is mentioned that with the initiative already taken for modernisation/
indigenisation, your Company, is ready to meet the requirements of Currency, Coins
and other Security Products required by the Central and State Governments & other
organisations.
ACKNOWLEDGEMENTS
I would like to acknowledge with deep sense of appreciation the cooperation received from
the Government of India, particularly from the Ministry of Finance, Reserve Bank of India,
Ministry of External Affairs, Ministry of Home Affairs, Department of Posts, Department
9
�!� ��<'��� F���"�����$� �������� �!� <���$� E�"�*��� �!� �������� ��� S*�'�� H�'!���and various State Governments. I am also thankful to my colleague Directors for their
valuable inputs and laudable support. I would also like to acknowledge with thanks the
constructive suggestions received from Comptroller & Auditor General of India and the
��������������� �'�$�)�;��'��'���'������"'������������������������""���������!�the devotion and commitment of all executives and employees of the Company.
Jai Hind.
Sd/-
Place: New Delhi (M.S. Rana)
Date: 27th September, 2012 Chairman & Managing Director
10
SECURITY PRINTING AND MINTING CORPORATION OF INDIA LIMITEDREGD. OFFICE: 16TH S ##I$���H�T�I�UX���I�DT�H�%$���%��+T$�%FH�EF T)�Y���A�AA�
NOTICE
Notice is hereby given that the 7th� ���=����� �%%M� � &F%FI� � �FF+)%&� �!� �����*<���� �!� �������� ������(� ��� �����(� ���"������ �!� )���� �*���� ;�''� <�� ��'��on Thursday, the 27th�����!���"�*<��$�?A�?���ZAA�"*��I�(�������#!�����!� ���Company situated at 16th Floor, Jawahar Vyapar Bhawan, Janpath, New Delhi–110 001
to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the Audited Balance Sheet as at March 31, 2012
������������� �����������!�������������������������(�����;������Reports of the Directors’ and the Auditors’ thereon.
?�� +��""��=�����"�*����!�E�=������>�?AB��!�����+C��������!������*"���!�����������'�����?A��K�?�
V�� +���C������*���������!�������������!������*"���""������<�������*"��''���and Auditor General of India for the year 2012-13.
By Order of the Board of Directors
Sd/-
(SACHIN AGARWAL)
Asstt. Company Secretary
Date: 27th September, 2012
Place: New Delhi
NOTES:
��� ���F�DFI�F%+)+ FE�+#��++F%E��%E�U#+F�)��F%+)+ FE�+#����#)%+����I#[X�+#��++F%E��%E�U#+F�)%�+F�E�#S�T)��F S���M�T��I#[X�%FFE�%#+�DF����F�DFI�#S�+TF��#���%X��+TF��I#[X�S#I��)��F%� #�FE�
2. Member/Proxy holder must bring the attendance slip to the meeting and hand it
over, at the entrance of Meeting Hall, duly signed.
11
DIRECTORS REPORT
TO THE MEMBERS
On behalf of the Board of Directors, it is my privilege to present the 7th Annual Report of
�����*"�����������������'���������!�����������'�����������V�st March, 2012
together with the report of the Statutory Auditors and Review of the Comptroller & Auditor
General of India thereon.
FINANCIAL RESULTS
X������*"����������=����C��''��������'�����'����"���������'��(�=���<�'�;Z
(` in crores)
Particulars 2011-12 2010-11
Sales 3422.68 3134.57
Gross Income 3662.45 3456.89
Expenditure 2788.07 2616.57
�����D�!����FC���������)�*����+C��� 874.38 840.32
���Z��������������)�*��\�FC���������)�*���%F+� (0.49) 23.38
�����!���FC���������)�*�����������������)�*$�before Taxation
874.87 816.94
���Z� +C�FC"����
Provision for Current Tax 268.65 267.04
Provision for Deferred Tax 20.07 (23.59)
Taxes of Earlier Year 3.69 (3.70)
������!���+C��� 582.46 577.19
Proposed Dividend & Tax 135.39 134.61
Transferred to General Reserve 58.25 57.72
D'�������!���������� ��\� 388.82 384.86
12
` `
`
`
The Annual Accounts for FY 2011-12 have been prepared in compliance of revised �������� � � ��� � ������� ���� ����� ��� ������ ! ���"� �� #��� ��"� $������� ����%����������&����"����������#�
CORPORATE PROFILE
��������������(��������(����"�������!�)���� ��������) ���������������(���K)�CPSE wholly owned Schedule ‘A’ Company of Government of India, incorporated on
13th������$�?AA]�;������I�(�������#!�����%�;�E�'��������) $������((���������manufacture / production of Currency and Bank Notes, Security Paper, Non-judicial Stamp
Papers, Postal Stamps & Stationery, Travel Documents viz. Passport and Visa stickers,
�������� ��������$� ���Q���$� D����$� H����$� �"���'� ��������� ;��� ��������S�����$� �������� )���$� �����'���� �� ��**�*���=�� �����$� ���''����$� I�����(� �!�Gold, Silver and Assay of Precious Metals, etc. The Company has achieved Excellent
rating in its Memorandum of Understanding (MoU) evaluation again for 2010-11 and
poised for excellent rating in 2011-12.
ACTIVITIES AT A GLANCE
Broadly, your company is operating through nine units of four production verticals i.e. India
Government Mints, Currency Printing Presses, Security Printing Presses and Security
Paper Mill. A brief introduction of these verticals along with review of operational activity
during 2011-12 is as follows:
13
1. CURRENCY PRINTING PRESSES
There are two Currency Printing Presses
i.e. Currency Note Press, Nashik and Bank
Note Press, Dewas which are engaged in
production of Bank Notes for our country as
well as for foreign countries using state of
art technology. More than 40% of Currency
Notes circulated in India are printed by
your company. These units are equipped
with designing, engraving, complete
Pre-printing and Offset facilities, Intaglio
Printing machines, Numbering & Finishing
machines etc. Both the Currency Printing Presses are
)�#�NAA�Z?AA����)�#��OAA�Z?AAO���������������=��(�fool-proof accounting of security items, stringent security
����*��;����'�K*���������K!�����'���!��������*���facilities and complemented by a service department to
ensure maximum in-transit security. These units have
captive railway treasury wagons/carriages for transporting
the treasury consignments.
(a) Currency Note Press (CNP), Nashik
Currency Note Press (CNP) became a separate Unit from ISP in 1958-59 and it started
printing and supply of currency banknotes in all denominations from the year 1961. The
"����������!�����M���!�����������'����������(�V�st March, 2012 is 4430.44 million
pieces against the 4133 mpcs in the year 2010-11 of different denomination of bank
notes. CNP has supplied 4481 million pieces of banknotes during the year 2011-12 as
(����OVA��*�''����"�������!�<������������(����'�������'�����?A�AK�����ID)����Nepal Rashtriya Bank.
Administrative Block of CNP, Nashik
14
(b) Bank Note Press (BNP), Dewas
Currency Printing: Bank Note Press, Dewas
was established in the year 1969 and the
production commenced in 1974. This press
also manufactures different types of security
Inks for various security organizations.
Its banknote production during 2011-12 is
2110.98 mpcs against the 1339.40 mpcs in
the previous year.
Ink Factory: Its annual installed capacity
of Inks is likely to be enhanced to 1160
MT. BNP manufactured Quickset Intaglio
Inks departmentally for use on Super Orlof
Intaglio printing machines. During the year
2011-12, Ink Factory has manufactured
around 272.622 MT Inks.
2. SECURITY PRINTING PRESSES
Your company’s Security Printing Presses
have glorious history of more than 80
years employing specialised technology
and multiple printing processes to produce
security products under secure operating
procedures and manufacturing protocols.
These presses have the latest technological
facilities for Designing, Pre-printing and
Post-Printing.
Your Security Printing Presses have the
capability of incorporating security features
like chemically reactive elements, various
Guilloche patterns, micro lettering, designs
;��� MU� ����$� <�KP��������� ����$� �"��'�variable inks, micro perforation, adhesive/glue, embossing, die-cutting and personalization
etc.
Administrative Block of BNP, Dewas
Printing Press at SPP, Hyderabad
15
(a) India Security Press (ISP), Nashik:
India Security Press, Nashik was
��<'������ ��� ��������N?R�����������as commercial industrial unit under the
administrative control of Govt. of India,
Ministry of Finance. It is an ISO 9001:2001
��� )�#� �OAAAZ?A��� �������� ����� )���prints and supplies judicial/non-judicial
stamp papers, all types of postal & non
postal stamps & stationery, passports, visa
& other travel documents, MICR & Non-
MICR Cheques in continuous Stationery
form, Identity Cards, Railway Warrants,
Income Tax Return Order Forms, Saving
Instruments, commemorative stamps etc.
It has entered into other markets which
require documents incorporated with
security features and is developing new
"���������"���!���=����������
A specialized Forgery Detection Cell
also caters to the demand of various law
enforcement agencies and RBI.
)����������������FK���"���!����������time in India by undertaking production
�!� �!���'� ��� ��"'�*��� FK"��"���� ��latest version of E-Passport Manufacturing
System has also been installed in Passport
Section.
During the year under review, ISP also
�������!�''��"�����������""'������� ���I�=����� ��������$� ))++�� ��������$���;J��M��=��������������$��������U�+���������$�M+)�D������������� ��$�����*��������� ������ !���������'�(��'�Survey of India and CDC Stickers.
During the year 2011-12, ISP has made the ever highest production in SPU i.e. 49822.50
mpcs as against 37971.40 mpcs during the last year i.e. 2010-11 an increase of about
31.2% over last year.
Setting-up of New Passport Machine at ISP, Nashik
Postal Stamps
Passports manufactured by ISP, Nashik
16
(b) Security Printing Press (SPP), Hyderabad:
Security Printing Press, Hyderabad was
established in the year 1982 to cater
to the needs of the Central and various
State Governments by printing and
supplying security documents such as
Postal Stationery items, Central Excise
Stamps, Non-Judicial Stamps, Court
Fee Stamps, Indian Postal Orders and
Saving Instruments etc. It is an ISO
NAA�Z?AA�� ��� )�#� �OAA�Z?AAO� ��������unit and is equipped with modern pre-
press plate-making systems and post-
printing techniques with processing facility
for Perforation, Numbering, UV Print
+�����'�(�$�#�'������=�'�"��*���($�)�'��� ����$�����(�*�$����'������������
E����(����������������=��;$�������;����*������������(���S�������(�������� ����has been installed for online numbering and packing of printed stock at SPP. This will help
in augmentation of processing of numbered items with reduced manpower.
E����(����������������"��$��������'����������!�''��"�����������""'������� ���F'�(�<�'��� ���$� D��� �������� �!� I�=����� ���=����� ����� ��=�$� EK�� S��*� ���Advocate Welfare Fund Stamps for A.P. Government, Transport Permit and Import Permit
for Govt. of N.C.T. of Delhi and Warehousing Development Regulatory Authority Receipt
Books.
3. SECURITY PAPER MILL
Security Paper Mill (SPM), Hoshangabad was established in 1967 is an ISO 9001:2008 and
)�#��OAA�Z?AAO����������������"����<'��!���*��!�����(��!���!!������"����!���������
Security Paper Mill, Hoshangabad
Security Printing Press, Hyderabad
17
Papers. Papers manufactured by this unit are used for printing of Currency Notes by CNP
& BNP and for Non-Judicial Stamps being printed by ISP & SPP. SPM, Hoshangabad
has the distinction of incorporating numerous security features in paper viz Fluorescent
Fibres, Multi-tonal three Dimensional Watermark, Electrotype Watermark, various types
of Security Threads, Taggants, etc. At SPM, the eco-friendly process and the energy
conservation aspects are assigned the utmost importance. In order to indigenisation and
to meet the increasing demand of Security Paper, a new BIVIS Pulp Plant having pulping
�"�����!�?R��+�"���������<�������''������������������"��������!���'���'�����
During the year 2011-12, SPM has made the ever highest production of security paper of
2924.89 MTs as against 2857.79 MTs during the last year.
4. MINTS
Your Company’s four Mints at Mumbai, Hyderabad,
Kolkata and Noida have rich minting heritage and
legacy of producing quality products. These mints
are carrying out minting of all coins circulated in
the country. India Government Mints (IGM) offer
comprehensive range of services covering every
stage of the minting process– from planning to
��� �������� "�������� M�'�G���� �!� �=�����technology, innovation, quality and reliable
delivery methods are some of the components of
strength of these mints. IGMs have made a niche
in the minting world – with excellence in design,
expertise in minting precious metals, and above
all, a long tradition of craftsmanship.
Circulating Coins
The manufacturing process for circulating coins in these
mints constitutes a perfect symbiosis between the centuries-
old art of engraving, the minting process and the most
advanced industrial processes, world class technology and
*���'�*�(�*��$� ���<�'��$���*���������������coins adhering to extreme quality and security norms.
Mints are equipped with Computerized Numeric Control
Engraving Machines which are used for manufacturing
master punches / matrix / dies for coins. India Government
Mints are having more than 60 Coining Presses including 18
'���������(����������D'����(� ��������'���=�'<'��!���in-house production of coin blanks. Mints are having Pickling
�����'�����(� �����!���"�'�����(��!������<'�����E����(���������'� ���� ?A��K�?� ��� !���� *���� �=�� "�������� �=��� New series of coins
18
��(���������!�]?�?�*"����!������'��(�������(����]AW��*"��������(����'�������'�year.
Commemorative Coins
The Commemorative/Collectors’ coins are anybody’s
prized possession. Minting of these coins starts
with developing the designs and engraving by deft
hands. Then begins the mechanical exercise of
manufacturing master punch/dies on CNC machines
followed by stamping with Automatic Multi-Strike
Medal Presses, ensuring the top-notch quality. These
commemorative coins are manufactured in Proof and
Un-circulated variety. During the year 2011-12, the
following commemorative coins were released by the
Mints:-
1. 100 years of Civil Aviation
2. 100 years of Indian Council of Medical
Research (ICMR)
3. 150 years of Comptroller and Auditor General
of India
4. 60 years of India Government Mint, Kolkata
5. 60 years of Parliament of India
Medallion and Bullion Activity
Apart from circulation coins minting, IGMs are also a trusted name in minting of items
like Medallions and various bullion activities. Manufacturing of Medallion starts with
steps of creating a perfect design, followed
by quality minting which culminates into a
"�����'�G��� �C*������ �!� ��� �������product. The dies are put to an exceptional
care in terms of cleanliness and inspection
to generate output of optimum quality.
I�����(����T''*����(��!������������'��are also undertaken at Mumbai, Kolkata
and Hyderabad Mints. IGMs set benchmark
��� ��������������������� ����*�� ���emulated by other players as industry norm.
Commemorative Coins
19
Offerings of precious metals made to
various temples, religious places, trusts,
���� ��� ������� � )&��� ��� *��'�� ���minted from them as per design and
�"����������!�����*����
a) India Government Mint, Noida
This Mint was established in the year
1988 to take care of requirements
of Coins in the country. It is an ISO
9001:2008 and ISO 14001:2004
�������� ���� ��� ��� !��'����� !���conversion of blanks into coins. This
is one of the most modern mints in
the country. During the year 2011-12,
IGM, Noida has produced circulating
coins of 1872.97 mpcs as against
1617.95 mpcs in the year 2010-11.
b) India Government Mint, Mumbai
This Mint was established in the
year 1829, is one of the oldest Mints
of the country, where coins of all
denominations of non-ferrous alloys
and ferritic stainless steel material
are minted and made available for
circulation. It is an ISO 9001:2008
�������� ����� +���� ���� ��� '��� (��the capacity of minting medals and
������(��!�(�'���E����(��������?A��K12, the mint produced 1640.04 mpcs
as against 1655.61 mpcs in 2010-11 of circulating coins.
c) India Government Mint, Hyderabad
India Government Mint, Hyderabad was originally started in the year 1903 under
the rule of Nizam. However, after integration of the erstwhile Hyderabad State with
the Union of India, the Mint was taken over by Govt. of India. This Mint came to be
known as India Govt. Mint, Hyderabad. In the year 1997 the new Mint at Cherlapalli
;����<'�������)������)�#�NAA�Z?AA����������*�����������(�M����������������having facility to mint coins, medals and medallion. This mint produced 1948.12
mpcs of blanks in 2011-12 vis-à-vis 1889.20 mpcs last year and produced 1224.80
mpcs of circulating coins vis-à-vis 1213.25 mpcs last year.
������������ ���������������������������������
India Government Mint, Noida
India Government Mint, Mumbai
20
d) India Government Mint, Kolkata
Originally different minting facilities
were created in and around Kolkata in
the 18th Century. One of the Mints was
modernized in the year 1952 and it was
known as Alipore Mint. Old mint at Strand
Road is popularly known as Silver Mint.
������&�=���*����!�)�������*�����as India Government Mint, Kolkata. It is
an ISO 9001:2008 and ISO 14001:2004
�������������=��(�''�!��'������!�*����(�coins and manufacture of medals and medallions. During the year the mint produced
1544.55 mpcs of circulating coins vis-à-vis 1584.31 mpcs last year. IGM, Kolkata also
produced coin blanks of 1911.51 mpcs in 2011-12 as against 1914.40 mpcs in 2010-
11. The Mint celebrated its Diamond Jubilee on 31st March, 2012.
MODERNISATION AND CAPACITY AUGMENTATION
����) ����""��=�����"�'� ��=��*���"'���!�` 2474 crore w.e.f. 2009-10. This will
enhance capacity, capability in production of raw materials like Banknote Paper, Security Inks,
etc. for printing of state of the art currency notes and minting of coins of advanced designs.
Currency Presses
� Installation and commissioning of the one new latest state of the art Banknote
Printing line has been successfully completed at BNP, Dewas and production has
'���������������*���+����;�''������������"��������"<�'����!�����) �in printing state of the art Banknotes with new security features. Under one-line
*������"��(�**�$��"K(�������!���*<�����F!P������;(��+��*����'��and Treatment Plant (ETP-Ink) has been completed for protecting the environment.
� The regular production on BPS-2000
(Bank Note Processing System)
installed at BNP, Dewas and CNP,
Nashik has been started from April,
2011. These machines are equipped
with banknote examination and online
shredding of the spoil notes, as well as
banding and shrink wrapping. With the
introduction of this machine, there will
be substantial saving of manpower and improvement in quality of the Bank Notes.
�� I������(��!�F'�������($�%�*<����(�����������(�����*����%�*����*�������has been completed at BNP Dewas. Further, the work order has been placed for
overhauling of two Superorlof and Intaglio machine at BNP Dewas.
India Government Mint, Kolkata
Bank Note Processing System
21
� CAD and CToP System: Installation of one CAD and CToP System each for CNP
Nasik and BNP Dewas. This will lead to latest software & hardware in designing
and pre-printing of the state of the art currency notes.
� Varnish Coating Machine: Varnish coating machine has been installed and
commissioned at CNP Nasik. The machine is capable of coating both the sides of
the banknotes in sheet form in single pass. This will help in prolonging the life of
the bank notes.
Ink Factory
�� )�������� ��*��������$� ����(���������������� ����"�����!� )���S����$��=��Triple Roll Mills (SDV 1300) have been installed and separate Heating and cooling
system of Varnish coating plant has been completed. With this, the capacity of the
ink factory will increase to about 1160 MT inks. This will take care of the complete
��Q����*����!��!!��$���('�������*<����(������!�������) ���;�''���DID%�� �
Security Presses
� During the year under reporting, the following machines/ equipment have been
procured and commissioned at India Security Press, Nashik:-
� Three number of Guillotine machines
� One CTOP System
�� I���K���(� !��� S������ ���� �� M%#� ��� �M& FI� "��"��� *��!�����(�machines.
� One Digital Video Spectral Comparator
� One HP make Indigo Press 5500
� Two Atlas Copco make Centralized Air Compressor each having capacity fo
]AAA� �����A�<��;�����������������������=�������
� One HMT make universal tool & cuter grinding machine.
� In order to modernise SPP, Hyderabad One new Automatic Processing & Finishing
�������''���!�����'������*<����(����"����(��!�"������������+����*������;�''�help in augmentation of processing of numbered items with lesser manpower.
Security Paper Mill
In order to modernise SPM, Hoshangabad, the following machines/equipment have
been procured, installed and commissioned. After modernisation the capacity of SPM,
Hoshangabad shall increase to about 9000 MT from 3000 MT at present.
� In order to meet the increasing demand of security paper, a new BIVIS Pulp Plant
having a pulping capacity of 25 MT per day (approx) has been installed and trial
runs are underway.
22
� A R&D centre for Paper, Pulp and
thread related matter has been
��<'������ � ��� ����� ���testing equipments & machinery
has been procured and installed
successfully in the R&D Center at
SPM, Hoshangabad.
� Order for import of Video Spectral
Comparator (VSC) and, Quality
Control Device (QCD) 200 MAG Premium have also been placed.
� R&D Cell has been setup and earmarked the location for housing the above
instruments. However, further renovation of existing building is in progress.
� NEERI Nagpur has been engaged for providing consultancy services for
modernisation & upgradation of existing yellow/black liquor plant at SPM
T����(<�� �� !�'�'� �����=����*��'���*"'������!���''����������'�D�����The work is likely to be completed by October, 2012.
Bank Note Paper Mill
+�����;��U���*"��� ��� ����*���!�D���%����"�����''� )�������=�� �*����;���RAZRA� �Q���� ��'���(� <�� ����) � ��� D����� I����=�� D��� %��� ������ �=�� ����DID%�� �����<���������"���������V��A�?A�A�������I�(�������#!�������'������Bangalore and Works are at Mysore. The Paper Mill will have a capacity of 12000 MT per
year to be commissioned in two phases.
With the commissioning of these two lines at JV Paper Mill and one new line at SPM,
Hoshangabad, major requirement of CWBN paper of the country shall be met indigenously
as against major requirement being imported at present.
Mints
RBI has given an enhanced indent of coins
over the last few years which necessitated
upgradation of capacity at IGMs. Following
new Machines were added under
replacement plan/upgradation of capacity
during the last two years.
a) Coining Presses: 18 Coining
Presses have been procured and
commissioned at all the Mints. With
Installation of these presses, the coin
minting capacity has increased to about 6000 mpcs with two shifts of 9 working
hours in each shift. Replacement of 8 new coining presses has been taken up.
BIVIS Pulp Plant
23
b) Blanking Lines: Mints at Hyderabad, Mumbai and Kolkata have procured one
number each of latest blanking lines with higher productivity and capacity to
accommodate greater width of coils.
c) Fully Automatic Integrated Sachet Packaging Line: Four Fully Automatic
)��(������������(��(� ��������!�������*������<������*�����*����!�RBI for supply of coins in Sachets.
d) Three nos. of pickling and polishing lines are being procured.
HUMAN RESOURCE MANAGEMENT
An Overview
� At the time of Corporatization, employee strength was nearly 18,000 which as on
31.03.2012 has reduced to 12,818.
� About 85 Executives in areas of Technical, Finance, HR, Marketing, IT and
Materials Management were recruited in the year 2011-12 keeping the long-term
requirements of the Company in view.
� An objective Performance Management System (PMS) has been introduced for
the Executives and Supervisors commencing from the year 2011-12.
Training and Development
Knowledge and skill development has become a continuous process in your Company.
� During the year 2011-12, three Executive Development Programmes (EDP)
were conducted in association with National Institute of Financial Management,
S���<��;������O�FC����=���!��*���������������M����������"����#!����were exposed to various functional areas.
� Altogether Company has trained 241 Executives (84.85%) out of Executives strength
in various training programmes
including at NIFM during the year
2011-12.
� India Govt. Mint, Hyderabad has
<���������������%��'��������"'��and execute the training programme
for Supervisors in technical and
soft-skill areas in consultation with
��� ���"���� #!����� #�� �!� �'�1,101 numbers of Supervisors, 517
numbers of Supervisors (46.96%)
have been trained.�������� '� ������ � ()�� &����� *�� ���# ����� �#)��� #��� �� �'*��+ $# ,� &����� �������. �� �/*�3#����$��
24
� 9 Units of your Company are accountable for training and developmental needs of
���)������'�H�������<����(���������"�����'���Q����*�����E����(��������2011-12, out of total numbers of 10979 Industrial Workmen, 1278 nos. of Workmen
were trained by the Units.
� Training of minority employees and a two days “Knowledge Update Programme”
was conducted for the Employees belonging to SC/ST/OBC category during the
year 2011-12.
Industrial Relations
� The overall industrial relations scenario in your Company during the year 2011-12
was cordial and peaceful.
�� �!������"�������$������'������;�����������;��� ����<J���=�� ���'�����C�F*"'��������"������=���!��*����������%����M����������"����#!���������+��������!�����) �F�S�+�����������S�����NR?��NNAV�*�*<�����!�F�S�+����!��*�''�%����M����������"����#!������������=�������'����(���C�+�����������!��W��������� ��� ���!����S��� ������� �*��!������"���G��������'�������!�F�S�+����;��������������(�''� ���M����������"����#!���������('�������������;�����;��������'���'��*����=��������(�?A��K�?�
Connecting with Employees
� There is continuous endeavour to keep the Inter-Unit involvement of employees
through various sports/cultural programmes.
� Inter-Unit Football tournament was
conducted in Kolkata in the month
of February 2012 where all the 10
teams which include Nine Units and
���"����#!����"����"���
� Company has since introduced
Awards to the Employees and also
to the Units for functional excellence.
� The best performing Units are
awarded with Running shield in the
following categories: (i) Environment
& Safety (ii) Energy Conservation (iii) Productivity (iv) Training and Development
(v) Rajbhasha (vi) Vigilance.
�� ����) � ��'�<���� S�������� E�� � )���� &�=���*��� ���$� %���� ��� �A��February, 2012 where the Secretary, Department of Economic Affairs, Ministry of
Finance addressed the Employees which was motivating and inspiring.
4�� *�� ���5�� 4���� 4����� � 6378 ��������������� ��� �� ����� 9��� : �$��� � ��������;<=�< $#>��>������! �$���
25
� Diamond Jubilee Celebration of India Government Mint, Kolkata was celebrated
on 31st March, 2012 where the then Hon’ble Union Finance Minister and other
West Bengal Ministers graced the occasion to commemorate the occasion.
CORPORATE SOCIAL RESPONSIBILITY
����) �������������=��������I������=��������(��������?A��K�?�!������;�'!���of the people as per the DPE guidelines. An amount of Rs. 4.36 crore was spent during
the year on various CSR initiatives.
� A Memorandum of Understanding with Bharti Foundation was signed on
19.10.2010 to promote Education in the backward areas with special focus on
(��'����'������"�����M$�'���;��"��=�����<��D����S���������������) ����already constructed nine primary schools in Murshidabad District of West Bengal.
These schools are being run by Bharti Foundation which is successfully running
more than 242 schools all over India. 995 students are studying in the schools in
pre-primary, class-I and class-II comprising 51% girls and 49% boys.
� A sum of Rs. 4.68 lacs was spent in Rajasthan through Jansankhya Sthirta Kosh.
41 ,���� �>�� '���� have been distributed to the eligible couples who have
undergone sterilization after having one or two children.
�� V?W�"�����;����"��=����������'�'�*<��;��'���AR�"�����;����"��=������''�"����at a cost of Rs. 10 lacs during the year 2011-12 through Mahavir Viklang Sahayata
Samiti.
� The work of improvement of road side amenities for road connecting U.S. Gymkhana
with Nashik Pune Highway and Jail Road side in Nashik at a cost of Rs. 88.63 lacs
through State Government during the year 2011-12.
� Rain water harvesting system and sanitation projects were undertaken at cost of
Rs. 19.29 lacs through Indian Red Cross Society, Mumbai during the year.
� Solar lamps were provided in Dewas Vridhashram, Hoshangabad village and
Nashik during the year at a cost of Rs.10 lacs.
�� D'������������*"���=��<������(�������������!�''��<������) �������M�����ISP, Nashik, IGM, Kolkata and BNP,
Dewas during the year 2011-12.
�� E����(� ��� ���� ?A��K�?$� ����) �conducted a Training programme
in National Institute for Micro, Small
& Medium Enterprises, Hyderabad
for 101 MSME personnel working
in various Micro, Small & Medium
Enterprises providing products and
services to the different Units. ��������'� ������ ��������$#�'*��+��?��� ������������! �*�*)�3#����$��
26
All the projects mentioned above undertaken by the Company during 2011-12 have gone
through the process of baseline survey. The projects were duly monitored and evaluated
by independent consultants.
IMPLEMENTATION OF OFFICIAL LANGUAGE
�� ����) � �������!�''�� �<���=��� T����H���� ��� ������"����#!���������(� ���month of September, 2011. A compilation
�!� #!���'� �(�(�� I�'��� �*�'��‘Rajbhasha Ready Reckoner’ was
released on this occasion. Diglot chart
(laminated) was also provided to all the
#!������
� Bank Note Press, Dewas & Security
Paper Mill, Hoshangabad were the
���=������ �!� ��� +�;�� #!���'� �(�(�� )*"'�*������ ��**���� �"����(�from Dewas & Hoshangabad respectively. Besides it, Bank Note Press, Dewas
has been publishing “Banoprin” a quarterly in-house journal continuously for the
'��V?����������*(G�����*���^&����=`�!��*�+# )��E�;��!������'��16 years without fail and both above magazines have also won many laurels.
� Further, Currency Note Press, Nashik, India Security Press, Nashik, Security
Paper Mill, Hoshangabad, India Govt. Mint, Kolkata and India Govt. Mint, Mumbai
bring out their respective house-journals named “Mudra Bharti”, “Prati Mudran”,
“Pratika”, “Kalarth” & “Mumbai Mint Patrika” respectively.
� During the year, India Govt Mint, Hyderabad has also published ‘Taksal Jyoti’ a
unique magazine in four languages viz. Hindi, English, Telegu, & Urdu.
�� +������"����#!���$�%�;�E�'��� ��� )����&�=���*������$�T����<���=��been honoured with ‘Karyalaya Deep Shield’ by Rajbhasha Sansthan, New Delhi
!����C�*"'���;������������'���!�#!���'� �(�(��
� “Shree Shankar Dayal Singh Rajbhasha Shield” was introduced during the year
?A��K�?� ��� �����;��� ��� (���� �� )���� &�=���*��� ���$� T����<�� !��� ����������(� "��!��*���� ��� ��� ��� �!� #!���' �(�(��� )���=���'� ;���;��(�=�����E������*�����=���$��������(����# �$� )&�$���*<��!������������<�������������'���!�#!���'� �(�(��
�� ����) �������<'������*�����!�������=������*"������&�=��E�"�*����;�������<J���=����"��*�����������!�T���������!���'�;����
� MOU with Department of Economic Affairs, Ministry of Finance was signed
bilingually by the Corporation for the year 2012-13.
3����@ �>�� � ��������$#�'*��+� �� ����B!���
27
� Bank Note Press, Dewas and India Government Mint, Hyderabad successfully
organised two joint Hindi Workshops during the year 2011-12 under the aegis of
���"����#!����
�� ���������!�S���������"�����������"����#!�����!������*"����%�;�E�'���and India Government Mint, Mumbai during the 2011-12 to ensure progressive use
�!�T���������!���'�;����
����) ����"����=�'����**����!����*"'�*�������!�&�=���*�����'�������=������#�������������<�����E�"�*����!�#!���'� �(�(��!��*��*�����*��
VIGILANCE ACTIVITIES
1.1 Vigilance set upZ�+���D�����!�E���������!�����) ����""��=��������������!�?R�"����!������U�(�'����E�"�*����!�����) ������!�����\�!!����;�����(�������"�����!������;�''����������������'����!���U�(�'����H�����#����"��������������''��(��"�
1.2 The work of Preventive Vigilance has been given primary importance. Vigilance
E�"�*������<��������(�����*"����;�����!�����'�������'�U����������!�security items in the units. CTE type inspections are being conducted regularly.
There is a substantial improvement in online payment to the suppliers. Tenders and
tender award details are being uploaded by the units in a regular manner. A system
of online registration of complaints has been started. Various initiatives have been
made in this period to undertake effective Vigilance work as summarized below.
2. Impact/Achievement of Vigilance functions:
i) There has been a discernible improvement in following of rules, procedures
and guidelines relating to procurement, tendering and other vigilance activities.
Important circulars from Central Vigilance Commission have been compiled
and explained to senior staff in the units by Vigilance Department.
���� +��������<������(�������"����<��'���(�*��(���!!�;�����(����=�(�'���$�"������*���;�������������!��������
����� �=��(��(��!���!��*���������'�(�����<�����C����=�'�������<��!��������(�of tenders and post award details on web sites, increasing e-payment and
providing Vigilance Department with the facility of registering complaints
online.
iv) A new Procurement Manual approved by the Board and vetted by CVC has
been released by the then Hon’ble Union Finance Minister on 23.05.2012.
Vigilance Department was associated in framing this unique Procurement
���'��+�������<���(����(�������*"��=�*�������"������*���"�������
vi) On the basis of observations made by Vigilance Department in CTE type
inspections, recoveries have been made in some cases from suppliers.
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3.1 Dissemination of information pertaining to important CVC guidelines: Amongst
others, information on monthly basis is collected on the subject of negotiations with
K�����������$�;������*"'�������''���'��(�;���������$��"'����(��!��������in downloadable form in websites, publishing of post award details on websites,
�*"'�*�������!��K"�*���$������!������"��!���*"'����������"����#!����and in units etc. This has the desired effect and yielded good results due to closer
monitoring & supervision and also improving transparency in decision making.
3.2 Integrity Pact: Initiative has been taken for adoption of Integrity Pact (IP) in major
�������*�����=������������) ��+����*����=��<����""��=���<���������'�Vigilance Commission on the panel of Independent External Monitors (IEM’s)
!�������) ��+���������'��='����!����"������*�����<����������������������Integrity Pact has been approved by the Ministry. The IP shall be introduced in
future tenders above the threshold value.
4.1 Intensive Training of staff involved with procurement: It was felt that training of
all procurement staff along with other staff involved in procurement work needs to be
taken up. This training was conducted at different units wherein procurement staff/
�!������!��*�''�����������������'����(����"�����!�����=��(�=�����*"�������=�����������=����"�����������<J���*���������=��$��������=�(�'�����!���'���=���!������������������*����(�;������"������*����!!\��!�������!���������to clarify the procurement issues including related CVC guidelines.
���� ������������������� ���� ����Z�E����(�������$�U�(�'�����!���'��;������"����rotationally for the various training programs/Seminars like Ethics, Accountability
��������"�������=�����j��������*������'��!�����) �����������*����!�consultancy & other services. In all, 42 man-days of training were imparted during
the year.
5. Conduct of CTE type inspections by CVO: Four CTE type inspections were
������������'����;����U��������=������������(����+�����**���\�'���������received from the concerned authorities on the Intensive Examination Reports
were scrutinized. Based on the
observations of the CTE type
inspection reports, guidelines were
issued for future compliance to
��*�=�� ������������ ������� ��� ���system.
6. Activities during Vigilance
Awareness Week: The Vigilance
Awareness Week was celebrated
from 31st October to 5th November
2011. During the Vigilance Awareness
Week, in addition to other activities
like Interactive sessions with the
+������ � C'��������� !?������D������E$#4��*�� ���5��4����4����� �6378 ���� ����� � !���������&�������Week-2011
29
�C����=��$� H������"�$� ������\��*����� <�� "��*����� !��'�$� =������\suppliers meet, slogan writing/debate/painting/ drawing/quiz competitions etc were
conducted for increasing awareness in the company.
�� !��"��������������#��$������#��� ���%���� ������&$%'������ "�( As per the
decision of DEA, MoF, this work is now being done by the Vigilance Department of
����) �;���!��A��AO�?A�A��E����(��������?A��K�?��������U��;������'��������������!�����) ��D�����������<���=�������������������(������=���������$�four guidelines were issued for system improvement.
)�� *��������� +������ $������ ����� ���� ����� �� �� ���� �� ,������� ���������: In
compliance of the Instructions of CVC, the sensitive posts in the company have
<������������������!��*������U���TI�E�"�*������<�����=���������������!������;�����(���������"����!����'��(��*���E����(�������$�?����������!���orders were issued by the management. Preparation of Agreed list and the list of
�!�������!�E��<!�'�)��(����;������*"'����;������*�������������'�U�(�'����Commission.
9. Annual Property Returns: As a surveillance measure, Annual Property Returns
���I��� �!� ��� �!���'�� ;���� ��<J��� �� �������� ��� �'��������� ;���� ���(��wherever necessary. During the year, 216 numbers of APRs have been scrutinized.
10. Disposal of Complaints: Upto 31st March 2012, 93 complaints have been received
in the Vigilance Department since its inception and 79 numbers of complaints have
been disposed off/closed and remaining 14 complaints are in process and under
various stages of investigation. The following are some of the few important actions
taken on the complaint during the year:-
��� +;����(���(� �������;�������""����� ��KP����;���*���*����<�� ���units after initiation of action by the Vigilance Department on receipt of a
complaint.
ii) A major penalty charge sheet has been issued to a supervisor for submitting
!�����������
����� �� *J��� "��'�� "��������(� ��� � ��*"����� ���� ��=�'=��(� !���� �!���'��including GM of the unit is in process which was picked up for investigation by
U�(�'����E�"�*����!�����) �!����+F����"������<���U��
iv) Disciplinary Authority imposed a minor penalty of censure in a composite case
��=�'=��(�!�����!���'��<�������������'�������������**���������������(����������=���(���������!����'��(��!����*"'���
v) It has also been decided by the Disciplinary Authority to issue a written
;����(�������*"�����������=�'=��(�������!���'��<���������������(���!�an investigation done following a complaint.
vi) An advisory warning has been issued to a supervisory level staff based on
��������(���!�����=���(���������<�����U�(�'����E�"�*���!�''�;��(��complaint.
30
11. Review of Performance: Performance of Vigilance Department was reviewed
��(�'�'�� <�� ��� ��E� �� D���� �!� E�������� �!� ����) � ��� ������� �� ��������=��;�����������<������U#$�����) ���"���"������<������*��
ERP BASED INTEGRATED INFORMATION SYSTEM
Your company is implementing SAP-ERP, most widely used ERP solution in the world,
������ ''� ����� ����� �!�����) ��+���� ;�''� ��'"� ����) � �� ���(��� ''� ��� ����� �����;������"�����!�����%�;�E�'����������''���!��*����"��������(��!������"���������within each unit would be automated. The implementation of SAP will not only enhance
���"�����$� �!�������� ��� �����*�� <�� ;�''� ��'"� ��� ����=��(� ��� �������� (�'� ;���relative ease and simplicity.
������������KFI�����<���� �*"'�*�����������''�������!�����) ���� ��� ��� ���stabilization phase. So far SAP-ERP core modules i.e. MM, PP, SD, FICO and PM, have
been implemented and the remaining modules i.e. EP, BI, ESS etc., shall be implemented
����������K)U����!�''��!������'�+����V$�)�#\)F��?WAA�Z?AAR���������E��������E�������"����(��)&��%���������) ����'�������(��"��E������I���=�����������EI����)&��T����<�$�;�������������'��(���!�����(�������������($�!�����**��������(�it will provide world-class secure IT infrastructure. With the implementation of SAP-ERP
the objective are to bring transparency and synergy in the operations of the Company and
ensure better services to the customer and ultimately to citizens of India.
PROMOTIONAL ACTIVITIES
Honorary Sponsor of 10th Asian High Security Printing Conference-2011
The conference was held at Gurgaon
during 7th to 9th December, 2011. Around
230 delegates from 35 Countries have
"����"��� ��� ��� ���!�������� ����) �was made honorary sponsor of the event
by the organizers. The conference was
��'�� ��� )���� !��� ��� ���� �*�� ��� �� ;��inaugurated by Shri Ashwini Kumar,
E������� �+������'�$� ����) �� E����(�the conference one exhibition was also
organized for companies in security printing
industry to show case their products, new
�����'�(��'�����=�*���$�"���������������) ����'������"'���������������"������$���!��*������(����(�"���������!��'������"�����''��!��*�)������������������%����\��������"�����(�������T����<�������) �<���$������(������������'��(��C��<����$�has witnessed numerous business visitors from India and abroad who have shown keen
����������"�������\�!��'������!�����) �
����� ! �'*��+ �� &��� ��� �������# �� �����%��! ����� �����������=th����3����������#'�������� �!�������<=��
31
Participation in Stamp Exhibition titled SIPEX 2011 at Chennai
��� ����) � "��*����'� �����=�� ���reaching out to its customers particularly
�*"� ��''�����$� )��� � ���� �!� ����) �has participated in the SIPEX held at
Chennai during 7th to 9th October 2011.
ISP has mounted various Stamps, Original
Artwork, and Miniature Sheet etc in four
frames in invitation class category during
the exhibition. Visitors particularly school
going children have praised the display of
collection over the frame and evinced keen
interest in printing process of the postal
stamps.
INITIATIVES FOR IMPROVEMENT IN OPERATIONAL EFFICIENCY
Capacity Assessment Study
����) ������((���������=������!��\��)�����)���������!�)������'�F�(�������(��)))F�$�E�'�����"��� �� ����''�������� ��� ���''����"�����!�����) �����������((���measures to ensure optimum utilization of capacity. IIIE has submitted its report in June
2011 and supplementary reports on Commemorative Coins, Medals and Medallions in
December 2011. The study was also part of MoU targets for the year 2011-12. Committee
�����<'���M�������(���#�M��������I�"������'�������**����������) �����������rational assessment and optimum utilization of installed capacity.
Study of Supply Chain Management of Cotton Comber
Cotton Comber is a important raw material for production of security paper at SPM,
T����(<���+�����""'�� ����\����������!���""'�����!��������*<��������(��(��������������=�������(��G���*�����+����!���$�����) ������((�����(�*���Development Institute (MDI), Gurgaon to carry out the study on supply chain management
of Cotton Comber. The study was primarily based on secondary data, published reports
data and discussions. The institute has submitted its report in February, 2012. The study
has provided a deep insight into various facets of supply chain of cotton comber.
CUSTOMER ORIENTATION
Customer Satisfaction Survey for Passports
During 2011-12, achievement of Customer Satisfaction Index (CSI) for Passports
produced by India Security Press, Nashik with rating of 7.50 on 10 points scale was
�C��������M��(���+�����)�!���"��"����;����������<������"�����������'��
4�����#������� ������ ���������!�������$#�'*��+�����������')G<=��
32
�\��� ����� ������ )���� ���=�� �*���� ���)� �� ��'����� ����(�� �"��� �������(�process. The consultant has submitted its report in May, 2012 after completing customer
survey of different customer category comprising Consular Passport Visa (CPV)
E�=�����$��F�$�I�(���'����"����#!������I�#��$����"���#!�������#��$�)**�(��������������$� <�������$�S��������)�����$�S��(����E���������''�� )���%�������������) ��������=�������*������!������������!���A��������"�������(���'����"���������������������<���\����)� �
Workshop on delivering Customer Satisfaction at ISP Nashik
Indian Institute of Management (IIM)
�����;� �%���� �*"���� ��� �������out Customer Satisfaction Survey of
=����������) �"������������(�?A��K�?��To communicate the salient features of
customer survey, feedback received during
the survey and measures to be taken for
maintaining and improving the customer
satisfaction index, a workshop was held
at ISP Nashik on 18th October 2011. The
workshop was coordinated by Prof. Rajiv
Kumra from Indian Institute of Management
�))��$� �����;��%�����*"�����+���;������"�;�����(�����<����������;������*�$�E��������+������'�$�����) ����������<��<���VA��*"'��������"�������(���!!�����������!�����) ����'����(����"����#!����
EVENTS
Payment of Maiden Dividend for the Year
2010-11
����) � ��� "��� � *����� ��=������ �!�` 115.44 crores to Govt. of India for the
�����'� ���� ?A�AK���� ����� ����� I�$���E$� ����) � "�������� ��� *�����dividend cheque to the then Hon’ble Union
Minister of Finance, Shri Pranab Mukherjee
on 10.08.2011 at Delhi.
Laying the Foundation Stone of Bank Note Paper Line at SPM, Hoshangabad on
17th December 2011.
S�������(���������!�D���%����"��$����;�D���%����"��� ��������$�T����(<��is being set up. Foundation stone of the Mill was laid by the then Hon’ble Union Minister
of Finance, Shri Pranab Mukherjee on 17th December, 2011. The new bank note paper
�������&���,�����4����� �6���������8 ����������������@ �>�� � ����� ��������!���� ����"�#����'�?����>
�*4� �'*��+� ���� *��� 7��� ���������� ��� ������dividend cheque of ` ����HH �� ��� � ���� 3 �E$�� 9�� �*������� !:����������'����$*�>���5��
33
line at SPM, Hoshangabd is part of the
modernisation plan of the Company. By
���''���� �!� ���� D��� %��� �"��� ���$�the annual capacity of Security Paper Mill
Hoshangabad will increased by 6000 MT.
This new line is to be commissioned by mid
2014.
Commissioning of New Bank Note
Printing Line at Bank Note Press, Dewas
The Commissioning of New Bank Note
������(� ���� � D��� %��� �����$� E�;��was inaugurated by the then Hon’ble Union
Finance Minister Shri Pranab Mukherjee
on 7th January 2012. The One line Printing
��� �������(� �Q��"*���� ��� ��K�!K��with higher speed and have the capability
for incorporation of sophisticated print-
based security features which will help in
reducing counterfeiting of currency notes.
This machine will also result in improved
productivity as well as optimization in the
consumption of raw materials specially ink
and manpower requirement.
SPMCIL Celebrates Foundation Day
����) � S�������� E�� ;�� ��'�<����on 10.02.2012 at a function held at India
Government Mint, Noida. Shri R. Gopalan,
the then Secretary, DEA, MoF was the
Chief Guest and the programme was
presided over by Shri M.S. Rana, CMD,
����) �� ����� T�� �����"� I�$� ��� �� S�$�Ministry of Finance, Ms. Meera Handa,
DDG (Philately), Department of Post were
the distinguished guests at the function. On
this occasion, the best performing units of
����) �;����;�����<���������!�(����
SPMCIL Becomes Debt-Free Company
The Government of India had given an interest free working capital loan of ` 700 crores
�� ����) � ��� ��� ���� ?AAWKA���+��� ��*"��� ��� ��"��� ��� ;��'�� *���� '��� ��the Government in four yearly equal instalments starting from the F.Y. 2008-09 and the
���������� � !?�&I��>? ��'�������+�����I?'�4�&��$# ��� ����3 �E$��9�� �*������� !:�����������'����$*�>���5��
+�#��� ! : ������ � �� �� ! ��& I��> ? �� '���� +����� �'*� 3 ������$�� $# ���� 3 �E$�� 9�� � *������� !:�����������'����$*�>���5��
�&��� 4�����$��� � ������ �'*��+ : ������ � 4�#����$���� � �� �/*� ? ��� $# ���� 7� / ������ ���� ���#�4)��* :
34
last installment of ` 175 crores was paid by
��E$�����) $�����������I�����������'�Secretary (Budget), Shri Shaktikanta Das
��� ?V�AV�?A�?� ���� *���(� ����) � �Debt-Free Company.
MoU with Ministry of Finance
Your company has signed a Memorandum of
Understanding (MoU) with the Department
of Economic Affairs (DEA), Ministry of
Finance, setting an ambitious sales target
of `�VARA��������!���������'�?A�?K�V��+���MOU is based on the premise of a growth
charter in a globally competitive environment
��� !��;��� '�����(� ""����� �!� ����) �and incorporates new parameters and
weightages for evaluation of performance
;��� !����� ��� "���<�'��$� ��;� ����*��$�*���� �� "������ ��=���������� �� ;�''�as optimization of its various resources.
DPE has prescribed new parameters in
the areas of Research and Development,
Sustainable Development, Corporate Social
Responsibility, Corporate Governance and
Human Resources Management which
have been duly incorporated in MoU for 2012-13. The MoU also contains commitments in
the areas of customer satisfaction, adoption of innovative practices, project implementation,
participation in international tenders, Environment safety, etc.
Diamond Jubilee Celebration of India Government Mint, Kolkata
India Government Mint, Kolkata, a unit of
����) � ��'�<���� ��� E�*���� ��<�'���Celebration on 31st March, 2012 at Alipore,
Kolkata. Shri Pranab Mukherjee, the then
Hon’ble Union Minister of Finance was the
Chief Guest of the programme along with
other dignitaries.
Besides coinage production, Kolkata Mint
has produced different commemorative
coins for last six decades. During recent
years India Govt. Mint, Kolkata has
produced several commemorative coins
���� *��� 7���� �*4� �'*��+ ���������� ��� ���J�� !`�K��� ���! ���������������� !& �>����������� ��!� �* :� �������>��>����4������������������#�6I�����8
)L�������� !* 9<=�<;�M$��&�������*���7�����*4��'*��+�������7�/ ���������������������#�4)��* :
7������ !� ���� ����"�� �� �4��� ��D�$���� !�/*�, �>��� $# ��� ���� 3 �E$�� 9�� � *������� ! :�����������'����$*�>���5��
35
on various themes like 150th Birth Anniversary of Shri Rabindra Nath Tagore, Mother
Teresa Birth Centenary, Commonwealth Games, 150 years of Income Tax in India, 150
years of Comptroller & Auditor General of India etc. This Mint has also produced medals
of various types like the highest civilian medals viz. Bharat Ratna, Padma Vibhushan,
Padma Bhusan, Padmashri, Gallantry medals viz. Paramvir Chakra, Mahavir Chakra, Vir
Chakra Sena medals for Defence, Medals for Ministry of Home Affairs, Commonwealth
Games, Educational Institutions, Social Services etc. Productions of Medallions for
National and International Film festivals are also the pride of Kolkata Mint.
AWARDS
� Your company has been awarded
Performance Excellence Award-2011
in Golden Enterprise Category
from Indian Institution of Industrial
Engineering (IIIE), Mumbai for its
�����'� ��� �"�����'� ����(���The award was received by Dr.
Manoranjan Dash, Director (HR) of
the Company on 15.06.2012 during
16th CEOs Conference on the theme
“India 2025: Industrial Perspective”
organized at Udaipur by Indian
Institution of Industrial Engineering, Navi Mumbai. This award recognises the growth
and performance excellence shown by the Company during 2010-11.
� One of the unit of your Company, India Security Press, Nashik had participated in
the Safety Award Competition during the year 2011-12 conducted by the National
Safety Council (NSC), Maharashtra Chapter, Mumbai. ISP has won prizes in both
�����(������=�G�� ��(�����������S�������������� �;����=��(����������Frequency Rate.
� Bank Note Press, Dewas has achieved ‘National Safety Award’ for the performance
year 2010. This achievement manifests continued best practices adopted by BNP
in industrial safety.
HIGH SECURITY MANAGEMENT SYSTEMS
������������������������'��!������(�������Y�����*����������������) ���$�where there is no compromise on Security under any circumstances. Each and every
product made at its various units is exceptionally sensitive in nature and of high value,
meeting all norms of Security and Audit Control. This is achievable through a network
of highly sophisticated system of monitored logistics, check and control mechanisms at
different areas, physical control barriers, security procedures and processes.
4��*�� ���5��4����4����� � 6378��'*��+ �����"��� ���'��! ������)L���������&���;<=��!� ����)�*��$��
36
Our security experts ensure that this
sophisticated vigilant security system works
perfectly round-the-clock to make sure that
the products we produce for our customers
are always under vigilant eyes. At present
CISF is looking after security arrangements
of 6 units and security of remaining three
units is entrusted to State Police Guards/
Departmental Security. Induction of CISF in
these units is also under process. State of
Art IP based security surveillance system is
being installed in six units.
ECO FRIENDLY OPERATION AND ENERGY CONSERVATION
� In pursuance to the Government Policies and Guidelines to reduce expenditure
���"��*�����;���� ����;<'������(�� ���������$�����) ���((���%���'�Productivity Council (NPC) to carry out an exhaustive energy audit at all Units.
Majority of the recommendations of NPC have been implemented.
�� I�K��'�G�����!�������!P��������������������;��������*"�������������������Paper Mill, Hoshangabad was taken as a project for research studies as MPPCB
Bhopal has been emphasizing time and again to bring down the consumption of
water to zero level as per the norms set by the MPPCB. Accordingly, M/s Mascat
Chemengers & Consultants were engaged to study the reutilization of treated
�!P��������������������;��������*"����������$�T����(<���+���<�=��"��J���;�����'����������M�"��J���<������) ��+����������������**��������(�;�������<������*"'������� ��'� �����!� ����'���������;������������+���plant is to be made operational soon after the completion of laying of pipelines to
different sections of the mill and construction of overhead tank, which is likely to be
completed by October 2012
� The Tree plantation is being carried out regularly by the units of your Company for
protection and conservation of environment. During the year under review, ISP,
Nashik, BNP, Dewas & SPM, Hoshangabad planted 500, 200 & 400 nos. of trees
respectively.
� The units of your Company have been complying with all the environmental
obligations pertaining to pollution matters. One of the units SPM has been granted
authorization under Hazardous Waste (Management, Handling and Trans-boundary
*�=�*�����I�'�$�?AA��!����=�������!��*�?O�AN�?AA����A?�AV�?A�V�!��*�����D$�Bhopal. Also the Consent under Section 25/26 of the Water (Prevention & Control
of Pollution) Act, 1974 for Water and Consent under Section 21 of Air (Prevention
& Control of Pollution) Act, 1981 for Air have been provided to SPM by MPPCB,
Bhopal for a period of three years from 01.01.2011 to 31.12.2013.
37
� India Security Press Nashik has taken up the work of Rain water harvesting project
in its Godavari Guest House, CSP Guest House and in ISP Estate Nashik Road.
ISP has also taken up the work for providing turboair ventilators and transparent
polycarbonate sheets in various sections in ISP. Total 62 turboair ventilators have
been provided in factory premises.
�� )&�$�%������"'����''������������U"��� *"���?RAH�����������"�P������������'�(���(�;�������(���!�������S ���RH������$�T����<��'�����"'�����RA�%�����!��C����(�R]A�;��<��'�(�����(�;�������(���!������?��H�+�R��<��'�(�����(�
�� D�� ��������(� ��� �!�������� �!� ���� ����������(� ����*$� D%�� E�;�� ���������"����������(�������*"����<��*����������!����=�������Q��"*���������*�$�BNP also reduced electricity tariff for residential colony from 1550 KVA to 1250
KVA.
� Six units of your Company i.e. CNP, ISP, SPM, IGM (Noida, Kolkata & Mumbai) has
implemented an “Environment Management System (EMS)” in compliance to the
International Standards ISO 14001:14004 for better environmental management.
COMMITMENT TO QUALITY MANAGEMENT SYSTEMS
Retaining its commitment to produce cost effective quality products, all nine units had got
)�#�NAA�Z?AAA����������������C�������=��'���(��)�#��OAA�Z?AAO�����������
DIVIDEND
+��� E�������� �=�� ����**������ � S��'� E�=������ >� ?AB� �!� "��KC� "����� �!� ���Company for the year 2011-12 aggregating to ` 116.49 crores plus Dividend Distribution
Tax of ` 18.90 crores in compliance of DPE’s O.M. No. 15(10)/2004-DPE(GM) dated
18th October, 2004 read with O.M. No.7(5) E-Coord/2004 dated the 24th September,
2004 of Department of Expenditure, Ministry of Finance bearing the subject– ‘Guidelines
on Expenditure Management—Fiscal Prudence and Austerity’ for compliance by the
"�<'�������"�������+������'���=������!�����������'�����?A��K�?���''�<��"���<�����Company after approval of shareholders in the forthcoming 7th Annual General Meeting
of the Company.
PARTICULARS OF EMPLOYEES
There was no employee of the Company who received remuneration in excess of the
limits prescribed under Section 217(2A) of the Companies Act, 1956.
ENERGY CONSERVATION
The Company is not required to furnish information in Form ‘A’ of Annexure to Rule 2 A of
the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988
38
pertaining to disclosure of particulars with respect to Conservation of Energy as it falls
outside the list of Industries prescribed for furnishing said information.
RESEARCH & DEVELOPMENT
The information as required under the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 with respect to R&D and technology absorption is
given in Annexure-I to this Report.
FOREIGN EXCHANGE EARNINGS & OUTGO
Sl.
No.Foreign Exchange Earnings/Outgo
2011-12
(` in Cr)
2010-11
(` in Cr)
1. Foreign Exchange Earnings 7.96 19.38
2.. Expenditure on Payment basis incurred
on Foreign Travel, Material Supply,
Capital Goods and Spares & Stores
0.38 0.59
3. Value of imports based on CIF basis (on
Accrual basis)
457.65 523.72
BOARD OF DIRECTORS
� Pursuant to Article 13(3)(a) of Articles of Association of the Company,
Smt. Meera Handa, DDG (Philately), Department of Posts has appointed as part-
�*��E���������� ���D�����!�����) �;���!����th August, 2011 in place of Smt.
Devika Kumar, DDG (Philately), Dept. of Posts.
� Shri Madan Mohan ceased to be Director (Finance) of the Company with effect
from 13th October, 2011 consequent upon his repatriation to his parent cadre by
virtue Order No. 2/2/2011-SPMC dated 13.10.20111 of Department of Economic
Affairs, Ministry of Finance.
DIRECTORS’ RESPONSIBILITY STATEMENT
Pursuant to the requirements under Section 217(2AA) of the Companies Act, 1956, with
���"�����E�������L�I��"����<�'�����*��$����������<�������*��Z
(a) That in the preparation of the Accounts, all the applicable Accounting Standards
have been followed along with proper explanation relating to material departures.
(b) That the directors have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and prudent
so as to give a true and fair view of the state of affairs of the company as at 31st
39
�����?A�?�����!�"�������'����������!����������������V�st March 2012.
���� +�� �������������=�� ����"��"��������!���������� !��� ���*���������!�adequate accounting records in accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the company and for preventing and
detecting fraud and other irregularities.
(d) That the directors have prepared the Accounts on a going concern basis.
STATUTORY AUDITORS
M/s. Serva Associates, Chartered Accountants, New Delhi were appointed as Statutory
���������!��������*"���!�����������'�����?A��K�?�<�������*"��''�������������General of India (C&AG of India) in terms of Section 619 (2) of the Companies Act, 1956.
Further 9 Branch Auditors were appointed by Comptroller and Auditor General of India
!��������(������������!������������!������*"���!�����������'�����?A��K�?��+���Statutory Auditors have audited the annual accounts of the Company for the year ended
31st March, 2012.
AUDITORS’ REPORT
+����������L�I�"������������'���������!������*"���!�����������'�����������31st March, 2012 and the Management’s Replies thereon and the Review on annual
accounts for the year ended 31st March, 2012 by the Comptroller & Auditor General of
India under Section 619 (4) of the Companies Act, 1956 along with the Management’s
Replies thereon are enclosed to the Directors’ Report as Annexure II and III.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis Report forms part of this Directors’ Report
as per the requirements of Corporate Governance as stipulated in the Guidelines on
���"���� &�=������� ������� <�� ��� E�"�*��� �!� ��<'��� F���"�����$� &�=���*���of India in this regard. The Management Discussion and Analysis Report is enclosed as
Annexure-IV to this Report.
CORPORATE GOVERNANCE
Your Company has been complying with the requirements of Corporate Governance as
��"�'���������&����'�����������"����&�=��������������<�����E�"�*����!���<'���Enterprises, Government of India in this regard. The Corporate Governance Report is
enclosed as Annexure-V�������I�"����+�����*"�������<��������������!��*�the M/s. AGB & Associates, Faridabad regarding compliance of conditions of Corporate
Governance.
40
ACKNOWLEDGEMENTS
The Board of Directors acknowledges with deep sense of appreciation the cooperation
received from the Govt. of India, particularly the Ministry of Finance, Reserve Bank of
India, Ministry of External Affairs, Department of Posts, Department of Public Enterprises,
�������� �!� T�*�� �!!���$� �������� �!� <���� �� F*"'��*��$� E�"�*��� �!� ��������and Family Welfare, various State Govts and also from Banks. The Board of Directors
acknowledge with thanks the constructive suggestions received from C&AG and the
Statutory Auditors. The Board of Directors also place on record their sincere appreciation
of the devotion and commitment of all employees of the Company.
For and on behalf of the Board of Directors
Sd/-
Date: 27th September, 2012 (M.S. Rana)
Place: New Delhi Chairman and Managing Director
41
ANNEXURE-I
FORM-B
(Pursuant to section 217 of the Companies Act, 1956
and the Rules framed there under)
RESEARCH AND DEVELOPMENT (R & D)
-�� *+� �� ����������.#� #�/�0�,� ���������������#��1��+���
During the year under review, the Company has taken-up R&D projects in the
��'����!���������""��$���������"�����($����������"�����(���������*�''��(���+���Company is setting-up R&D centres across all production verticals.
��� �������������������������������#��������/�0�,
The Company would be able to produce critical raw materials indigenously and
thus bring more indigenisation in its operations.
3. Future plan of action
� +��<���(�*�����!���������������(�������$�"���������"'����(����*��!�����(�processes.
4. Expenditure on R & D expenditure as a percentage of total turnovers
� E����(���������'�����?A��K�?$� �����*"������ ������������C"���������!�` 4.63 crores towards Research & Development activities. The percentage of R&D
Expenditure over total turnover is 0.13%.
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
1. Efforts, in brief, made towards technology absorption, adaptation and innovation
The major efforts made towards technology absorption, adaptation and innovation
are as follows:
�� ����(K�"��!���;�D���%����"��� ��������������"�����''$�T����(<��including stock preparation plant.
b) Commissioning of one line of Bank Note Printing at Bank Note Press, Dewas.
��� �����U�������������*���!�D���%����"�����''�)�����=�� ���!���"���������of Bank Note Paper setup at Banglore/Mysore.
d) Implementation of SAP/ERP across all the units.
��� �������������������������������#�������������������+���� ����+����������cost reduction, product development, import substitution etc.
Technology absorption, adaptation and innovation have resulted in indigenisation,
capacity enhancement and bringing more security and synergy in the operations
and also import substitute of critical raw materials.
42
3. In case of imported technology (imported during the last 5 years reckoned
���� �#�� ���������� �� �#�� ���� ���� ����'� ����.���� ����������� ���� ���furnished:
(a) Technology imported : D���%����"��� ���
(b) Year of import : 2011-12
(c) Has technology been fully absorbed? : Under Erection
(d) If not fully absorbed, areas where this has not taken place, reasons
therefore and future plant action. : N.A.
For and on behalf of the Board of Directors
Sd/-
Date: 27th September, 2012 (M.S. Rana)
Place: New Delhi Chairman and Managing Director
43
ANNEXURE-II
MANAGEMENT REPLIES TO AUDITOR’S REPORT
+�����������=��(�=�����������I�"��������"�������������������!�''�;��(��'����points emerged:-
1. The proper books of accounts as required by law have been kept by company
so far as appears from audit examination of those books. For preparation of
Company’s accounts, the branch auditor’s report have been considered. As per
the requirement of the Companies Act, 1956 the accounts are giving true and fair
view and are in conformity with the accounting principles generally accepted in
India.
2. The Para-wise comments on the Audit Report are as follows:
Para D(i) & Para I(e)(ii)
Suitable notes to account has been incorporated to disclose the provisional nature of
receipt of amount of Coins from Ministry of Finance and the increase/decrease in the price
�!���������qq���Q����������*�������!���'�"�������''�<���������������<��Q����years.
Para D(ii)
The contingent liability which may arise on account of pending employee claims & indirect
C�*������<�������;����Q��'��<��;���!�%���VW�����������'���*����
Para D(iii)
+�����*"������������"��������!�������������!�=��������(����������������FE���$�2006 at all units.
Para F(i),(ii) & (iii)
As per Ministry of Finance O.M. dated 10th February, 2006, all assets and liabilities
have been taken at the book value. Proforma Accounts of all these units are still under
��'��������������(���������!����^S�����!��*�&�=���*����!�)������J��<'��`�����"�'����������!������*"������<���(���P��������"��=�����'�<����������<������!����������!��������) ���������'��J��*��\��'�*����!�������������;�''�<��made on completion of proforma Accounts.
Para I(a)(i)
Company is following laid down accounting policies as well generally accepted accounting
������"'����&�����""'��<'�����)����������"��"������!������'���*������������are no major deviation except non-compliance of AS2 for valuation of inventories at SPM,
Hoshangabad and IGM, Kolkata units and few items of income & expenses are recorded
in books of accounts on cash basis.
44
Para I(a)(ii)
The company is generally following the Accrual System of Accounting however in few
cases pertaining to employees, insurance & income from forgery detection charges
entries are being made on cash basis. Amount is nominal and not material.
Para I(b)(i) & (ii)
The company values its inventories on budgeted cost and makes it reconciliation with
actual cost on completion of statutory audit for costing purpose. IGM, Kolkata is valuing
the inventories of commemorative coins & medals at 91% of last sales price as necessary
cost records will be completed on completion of statutory audit.
Para I(b)(iii)
+���������������!�����!�*���'��<��(��������;�''��=������*"��������"������'�����!������*"������;��'������*"�����P����<�������'�����"������������!����������transfers, however the same will have some marginal impact on inventories valuation in
�����"���!�����'�����"����;�����������*���'�
Para I(b)(iv)
�������<����;�������ID)�!���<'���������*�����M������;���(����"�����!��*�ID)�
Para I(c)(i)
In earlier years all units were under Government control and accounting entries are being
*����������<������!������"�������$�����) ���"�������'�����*��!��������($�however in initial period after corporatisation there were few entries which have not been
accounted on accrual basis due to late understanding of concept of accrual by old staff.
However, these problems have been addressed now.
Para I(c)(ii)
In earlier years some entries relating to consumables have been created twicely in tally
which has now been corrected. There was no separate details available for the period
01.04.2011 to 30.06.2011 and therefore entire amount was charged to prior period
adjustments.
Para I(d)(i)
As per the Ministry of Finance OM dated 10th February, 2006 all assets and liabilities have
been taken at the book value. Being commercial entity, the units have been maintaining
����������(�����<����������(�����<'����������'�!���!��������;���C����������('���Therefore, the assets have been taken in the books of company at net block (gross
45
block less depreciation). However, for the depreciation purpose the value is being shown
at gross block so that same technical life could be continued. This will facilitate easy
�'��'�����!���"��������;�������K��C�����!����'�!���!��������
Para I(d)(ii)
At SPM, Hoshangabad some of the machine have worked on triple shift basis during the
year 2011-12, however there is no authentic records of shift wise working at unit and in
the absence of the same, depreciation has been charged on single shift basis during year
2011-12. However, depreciation amount on machineries worked on triple shift basis is
nominal and not material.
Para I(e)(i)
During the course of last PPM held in June, 2011, it was deliberated that RBI will submit
a report to Government after studying balance sheets of all the units through independent
consultants. However the same study is still pending and RBI is releasing payment of
currency notes on provisional basis. The same has been duly disclosed by way of a note
�������'���*����
Para I(e)(iii)
The impact of any change in postal rates will be accounted for in subsequent years when
��'�����!�"��'���*��;�''�<�������'�G����+���!�����<������'������'�����<��;���!�������������'���*����
Para I(e)(iv)
In case of coins, passports and postal stationery the risk & reward is transferred to
customers at the time of sale as customers take delivery at the time of sale. However in
case of sale of currency note the risk & reward is passed to customers only at the time
of receipt and acceptance of the same by RBI. Company is initiating necessary steps
to recognise revenue in the books of accounts only at the time of passing risk to the
customers.
Para I(f)(i)
���"�����=�����������'��U)$���;$���*"����������Q�����������;���'�����<'�����!��C���assets in the Balance sheet and therefore question of overstatement of gross value of
�C����������������'�=��
Para I(f)(ii)
S�C��� ����� !����� ��� �C����� �����(� "�����''�� =��������� � )&�$� ��*<�� �� ���$�T����(<���=��<������P������I���\K�='�������������"��"��*������������!�these assets in company books.
46
Para I(f)(iii)
Any liability arising on account of stamp duty payable on title deeds of immovable properties
shall be recoverable from Govt. of India and therefore no provision for the same has been
made in the books of accounts.
Para I(f)(iv)
+����"��$� ��'������������� !�''�� ���(��� ��"������ '���������� !�''�;��(�"������accounting policies as it is not feasible to identify/ co-relate it separately with machine and
capitalize along with machine value.
Para I(f)(v)
���"�����������(������K�A������������(�!����C�������$��C������������'��<��capitalised when they are ready for use or have been put to use. As on March 31, 2012,
ERP project was either at implementation stage or stabilisation stage at all units and
therefore shown in books as ERP-W.I.P. However hardware comprising of computer
terminals at units, data centre and Disaster recovery centre have been capitalised as
they have been put to use.
Para I(g)(i)
������(���'��'��'���$�)&�$�%�������*����"��=�������!�I��OR�A?�'�������������!�arrears of anomaly in VI pay commission in terms of HO circular No 10/02/2011-EIII/A dated
19.03.2012, however the provision was made on the basis of all available information and
on estimated basis. The actual amount may differ from these estimates and difference if
any will be recognised in the period in which the same will be crystallized.
Para I(h)(i)
The land at sector 1 & 23 held by IGM, Noida are taken on long term lease, however in
initial years of lease no amortisation was done. Now in term of AS-119 the basic premium
paid for acquiring the lease is written off over the balance period of lease starting from
10.02.2006 i.e. date on which all assets and liabilities transferred to corporation and
ending on the date of termination of lease as per lease deed.
Para I(i)(i)
�����$�T����(<�������(�������� ���������=��<���� ���������!��� �*"��*���by an outside agency however necessary provision for impairment could not be made in
accounts due to difference in valuation of realisable value of some machine.
��)&�$�T����<�$�����C�����������!<��'�����������������<'����������$�<��their realisable value is more than book value and therefore no provision for impairment
is required in books of accounts in year 2011-12.
47
Para I(j)(i)
Company has made no provision for land revenue tax for SPP, Hyderabad unit based
on the legal opinion obtained. As per opinion only service charges are payable to the
Municipal Authorities and no land revenue tax is payable. Therefore no provision has
been created in SPP, Hyderabad books of accounts except for service charges payable
to Municipal Authorities. At all other units necessary provision has been made.
Para I(j)(ii)
Company has shown the liability which may arise on account of VAT or CST at ISP, Nashik
�������(���'�<�'���<��;���!�%���VW��������'���*�����������!���������������deviation of provision of AS29.
Para I(j)(iii)
Provisions are being made at units on the basis of latest available information at the time
�!���'�������!�<������!���������+�����'�*����*����!!���!��*���������*���and difference if any will be recognised in the period in which the same will be crystallized.
Para I(j)(iv)
Self explanatory & needs no comment.
Annexure to the Auditor’s Report
Para I
+�����*"������*������(�Q����=�����'�������������!�''��C���������Q������except to those assets where particulars were not available at the time of Corporatisation
i.e. 10.02.2006. In case of assets acquired after corporatisation full quantitative details
��� ������� ��� =�'<'��� E����(� ��� ���� ����������� �!� �C��� ����� ��� <������*"'��������"����#!��������*��M���������������!����������������������"��������!�''�������!� �����������*�����+�����*"��� ���'�������(�����(� �������*��!�"�����'�=����������!��C���������������������'�����;���<������!��������
Para II
+�����*"����������(�����(����"����������!�"�����'�=����������!���=���������'����(�stores & packing materials.
Para IV
The Company is strengthening its internal control system with respect to personnel
�������$� �������'����� �!� ��<���$� ��������� �� �=����$� ����������� ��� ='������!� ��K��������=�'�"�������$��C����������*���'�"������*��$��"���� ��"'��*���procedures & guidelines with regard to perquisites and business promotion expenses.
48
Para VII
E����(������'�����?A��K�?$� �����'���������"�����!�������''���������<����carried out through external Agencies, Audit Committee of the Board of Directors requires
the reports and as per its recommendations, internal audit is being improved. Internal
audit set up of company is also getting revamped and necessary follow up measures
have been initiated.
Para VIII
The Company has started maintaining cost records at all units as required by Central
&�=���������������?AN����<���!���*"�������$��NR]�!�����������'�����?A��K�?���necessary compliance.
Para IX(a)
Necessary provision has been made for a sum of Rs. 145.60 lacs towards leave salary
contribution & pensionary charges relating to IGM, Noida, VAT of Rs. 36.88 lacs relating
to ISP, Nashik and pensionery chages of Rs. 1182.24 lacs relating to SPM, Hoshangabad
which have not been paid as on balance sheet date.
For and on behalf of the Board of Directors
Sd/-
Date: 27th September, 2012 (M.S. Rana)
Place: New Delhi Chairman and Managing Director
49
ANNEXURE-III
Management’s Replies to the Comments of the Comptroller and Auditor General of
India Under Section 619(4) of the Companies Act 1956 of the Accounts of Security
Printing and Minting Corporation of India Ltd. for the Year Ended 31st March 2012.
Comments Management’s Reply
+���"��"������!������'���*�����!���������������(���������(����"�������!�)���� �*����!����������������31st�����$�?A�?����������������;�����������'���"����(�framework prescribed under the Companies Act, 1956 is
the responsibility of the management of the company. The
statutory auditors appointed by the Comptroller and Auditor
General of India under Section 619(2) of the Companies Act,
�NR]�������"����<'��!����C"������(��"�������������������'�statements under Section 227 of the Companies Act, 1956
based on independent audit in accordance with the auditing
and assurance standards prescribed by their professional
body, the Institute of Chartered Accountants of India. This
is stated to have been done by them vide their Audit Report
dated 30.07.2012.
I, on the behalf of the Comptroller and Auditor General of
India, have conducted a supplementary audit under Section
]�N�V��<�� �!� ��� ��*"����� ��$� �NR]� �!� ��� �����'�statements of Security Printing and Minting Corporation
�!� )���� �*���� !��� �������������V�st March, 2012. This
supplementary audit has been carried out independently
without access to the working papers of the statutory auditors
and is limited primarily to inquiries of the statutory auditors
and company personnel and a selective examination of some
of the accounting records. On the basis of my audit nothing
��(�����������*����*�����;'��(��;�����;��'��(�=�������to any comment upon or supplement to Statutory Auditors’
report under section 619(4) of the Companies Act, 1956.
As per audit conducted
by C&AG, nothing
has come to its notice
which would give rise to
any comment upon or
supplement to Statutory
Auditor’s report under
Section 619 (4) of the
Companies Act, 1956.
For and on behalf of the Comptroller For and on behalf of Board of Directors
����������&����'��!�)���� �!�����)
Sd/- Sd/-.
(Naina A. Kumar) (M.S Rana)
Principal Director of Commercial Audit & Chairman and Managing Director
FCK#!�������*<��$������D���K)U$�%�;�E�'���
Place: New Delhi Place: New Delhi
Dated: 07, September, 2012 Dated: 27th September, 2012.
50
ANNEXURE-IV
MANAGEMENT DISCUSSION AND ANALYSIS
HISTORY
�������� ������(� ��� �����(� ���"������ �!� )���� �*���� �����) �� ��� � �������Category-I Central Public Sector Enterprise wholly owned by Government of India.
����) ������((���������*��!�����(�\�"����������!�D���%���$����������"��$�%��Kjudicial Stamp Papers, Postal Stamps & Stationery, Travel Documents viz. Passport and
U��$�����������������$����Q���$�D����$�H����$��"���'����������;�����������S�����$� �������� )���$� �����'���� �� ��**�*���=�� �����$� ���''����$� I�����(� �!�Gold, Silver and Assay of Precious Metals, etc. The Company has nine units, i.e. two
Security Presses at Nashik and Hyderabad, two Currency Presses at Dewas and Nashik,
four Mints at Mumbai, Kolkata, Hyderabad and Noida and one Security Paper Mill at
Hoshangabad. All the 9 units headed by General Managers are industrial organizations
and are regulated in accordance with the labour laws and directions of Government of
India issued from time to time.
GLOBAL ECONOMIC CONDITION
Financial Year 2011-12 was a challenging year. The global economy, barely a year after
recession, witnessed lower economic growth, resulting primarily from the Euro Zone debt
crisis and high oil prices, which were fuelled by uncertainties of supply. Rising unrest in
the Middle East and North Africa (MENA) resulted in unprecedented levels of crude oil
volatility. The European economies stagnated and the US witnessed a downgrade in
its credit rating, while the growth engines of the global economy, China and India were
!������ �� �(���� '�Q������ �� *�� �����(� ��P����� )�� ������$� ��=�'� ������ ��� �<�� ���the tsunami in Japan posed further challenges. The year 2011-12 was abetted by the
continuing global volatility and challenges. These uncertainties led to widespread risk
=�����������=����'��!!������"�'�P�;������;�"��J�����+�����*"������!���'�*����opportunities led to socio-political tensions, increasing protectionism, reassessment of
regulation and more importantly, heightened competition for scarce natural resources.
OVERVIEW OF THE INDIAN ECONOMY
With increasing global integration, the Indian economy was impacted by global
����������$�;��'�������*���*��!������(��������*�������''��(����!�"�������������(����P���$��(��*���������������$�'�;���=��*��������'�����"�'����*���(��The slowdown in 2011-12 was seen in all the major sectors of the economy as compared
with the previous year. The service sector grew by 8.9%, Industry by 3.4 % and Agriculture
by 2.8% as compared with 9.3%, 7.2% and 7% respectively in 2010-11. Industrial growth
remains unchanged due to supply–side bottlenecks, particularly in the mining sector
and moderation in investment demand. The most dismal picture has been presented by
�"�'�(�������(*���;��������<����������(�=���������������(�������'����(�������'�;��;�� ;�� ;�������� ��� �"���� ������� �� ������ <�� �"�'� !��*���� ;�����decreased to 5.5% in 2011-12 as against 7.5% achieved in 2010-11.
51
INDUSTRY OVERVIEW
����) ���������������(*����!������*�����������������������"�����(����*����(�requirement of Government of India. The customers of the Company include Reserve
Bank of India for currency notes, Department of Economic Affairs, Ministry of Finance for
coins, Ministry of External Affairs for Passports, Ministry of Home Affairs for Visa stickers,
Department of Posts for Postal Stationary, State Governments for Non-Judicial Stamp
Papers, other CPSEs and autonomous bodies, etc.
SWOT ANALYSIS
Strength
�� ����) �����"<�'������������!�''�������������������'�����"����������!�security products.
· The Company has expertise in printing of Banknotes, minting of coins, production
of CWBN Paper, Ink and printing of all types of security documents.
� The Company has taken the initiative for indigenization of security paper by setting-
�"��!��U���*"����������*���!�D���%����"�����''�)�����=�� ������RAZRA�"�������"�;����\���DID%�� �
�� ����) �����=��(��"�'��C"��������"'��!���I���?OWO��������!����=�������!��*�2009-10 for modernization of its units and indigenization of security products.
����) � ��� ��*"'���� ����K)� �!� *������G���� �!� *����� �������G���� �!��������� ��� �"��� ��''� ��� ��K"��(������ ����) � ��� <���� ���!������ ���������(���K)�����<�����������!�S������;�����"��=������������������'����decision making powers to the Company.
�� �''� ���������!� �����*"������ )�#�NAA��������������C��������� )�#��OAA����������
�� ����) � �����'��"��=������!������'��(������**�*���=�������$�%���$����'�Stationary, Passport & Travel documents, etc.
Weaknesses
� The Turnover of the Company depends on indents given by RBI/Government
departments. It leads to uncertainty in taking strategic investment decisions.
� The historical manpower cost is high and plant & machinery being old require
replacement/upgradation. The working capital cost is also high due to Govt.
debtors.
Opportunities
� Export potential for coins and currency particularly in SAARC region.
52
�� )��������"����'����<�''����"�������\���**�*���=������������������=��������security products.
�� E�=���������� ��� ����*���� ��� ��� !��*� �!� ��������� ��Q����*��� �!� =������Ministries, PSUs and Independent bodies for security products.
Threats
� Reduction in indent of Postal Stationary, Non-Judicial Stamp Papers.
� Demand for currency and coinage products from RBI is variable.
� High Security cost due to deployment of CISF personnel.
� Metal prices are highly volatile.
� Increased competition from other players in retail bullion items.
FUTURE OUTLOOK
����) �<�'��=��� �� ����� �������(������ !���*������G��������"�����C"�������The Company is diversifying to new security products so that its spare capacity in security
"������� ��� <�� ��'�G��� !��� "��������� �!� ��=�������� "�������� +��� ��*"��� ��� '�������=����(���('�<''���C"�������"������������<��������) ��������(��G������only in India but also in third world countries.
RISKS AND CONCERNS
����) � ��''�� ��� "������� *��'�� �� &�=���*��� �!� )���$� ��� &�=���*���$� �����Governmental Authorities and Public Sector Undertakings. As far as core business of
��� ��*"��� ��� ���������$� ID)L�� ��<������$� �\��� DID%�� � ��� �"��� �"���� !���printing of banknotes thus creating a business risk. The other areas of concern are local
��!�������� '���� ������\<���$� �������L�� ��'������ �� !�'�''� ������ �<'�(����� ���risk of abnormal increase in cost of metals and other inputs, which may adversely affect
��=������!�����) �� )�������� ��*��(������������$�����(���'�����;��� '��'�"��J���staff/ unions and local administration are being developed and maintained. The costing of
the products includes latest raw material prices.
To strengthen security surveillance latest state of the art security system is being installed
in few units.
The Company has Central Industrial Securities Force (CISF) and State Para-Military
forces deployed to take care of the security of the units. CISF is being deployed gradually
���''�����������"�����������������!��T�����EF���)��''�(�����D������)D���!���'�����posted in the Security Presses and Security Paper Mill.
The Company’s Management is committed to further strengthen its risk management
capabilities in order to protect and enhance shareholders value. Considering the planned
efforts, monitoring by top management and participation of all employees in the decision
*���(�"������$����������������������;�''�;��������""�����!������*"���
53
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has a comprehensive system of internal control to safeguard the assets
(���� '���� !��*� �������G��� ���� ��� ������� "��"��� �����G���� �!� �����'�����������+�������*���=����(�''������'�����"����(�!����������������*"���is designed to provide a high degree of assurance regarding the effectiveness and
�!�������� �!� �"������$� ��� ��'�<�'��� �!� �����'� �����'�� ��� ��*"'����� ;��� ';�������(�'�������""'��<'�� ��� ���=��������'��� ���;����� �����*"����"������+��*��� ��� �����'� �����'� *���� �!!���=�� ��� "��J��� �"�����$� ��*"�������=�� �����'�audit manuals and accounting manuals are being continuously updated. The Company
has also implemented suitable control measures to ensure that all resources are utilized
�"�*''�$������'���������������"�����;�������������''�""'��<'��';�����regulations are strictly complied with.
The management of the Company duly considers and takes appropriate action on
the recommendations made by the Statutory Auditors, Internal Auditors and the Audit
Committee of the Board of Directors. The Company has continued its efforts to align its
process and controls with global best practices. To make the internal control more effective
and transparent, the then Hon’ble Union Finance Minister Shri Pranab Mukherjee had
released the new procurement manual of the Company to enhance transparency in the
operations of the Company to the highest level. SAP/ERP will be fully operationalised by
?A�?���������<���(����"�����$��!������������������*���������"�������
��*����(������!�������!������'������'�����*���Z
� Preparation and monitoring of annual budgets for all major activities.
� A well-established internal audit team reviews and reports to management and
Audit Committee and corrective measures are taken in time for continuous
improvement.
DISCUSSION ON FINANCIAL PERFORMANCE
Sales of the company increased by 9.19%, to `� VO??�]�� ������� �����(� �����'� ����?A��K�?�!��*�V�VO�RW����������������'�����?A�AK����#��������*����!������*"���decreased 26.56% to `��]W�]R������������(������'�����?A��K�?�!��*�` 228.29 Crores
��������'�����?A�AK���
+����"����(�"������DE)+���!������*"������������<��O�]WB�!��*�` 940.50 crores
���"��=����������'�������`�N�O�OO����������������'�����?A��K�?��%��"����!���C�also rose to ` 582.47 crores in 2011-12 from ` 577.19 crores in 2010-11, registering an
increase of 1%. The Company has repaid loan amount of ̀ 700 crores taken from Ministry
�!�S�����$�&�=���*����!�)�����+��������'�����?A��K�?�'���;����������������=���reaching of `�?VWA���������X����D���� !��'���""�� ��"��"�������'���=������ !���S�X��?A��K�?��!�?AB��!�"��KC�"������!������*"���((��(��(���` 116.49 crores plus
Dividend Distribution Tax of ` 18.90 crores.
54
HUMAN RESOURCE DEVELOPMENT
It is the Human Resource which is an invaluable asset during the phase of transition in our
Company and various measures are being taken for welfare of the Employees including
Socialization programmes, Community activities, Cultural functions, Games and Sports
which are slowly getting momentum in the corporate life.
During the year 2011-12, an extensive exercise on manpower planning covering
employees across all regions has been carried out. For optimization project reallocation
has been done on geographical basis and job description of all executives across all
'�=�'�����!������'������=��<��������������+�������������*"������'�=�'��!����executives in a better way a new performance appraisal system has been introduced in
line with DPE guidelines.
In the area of training and development, your company has been focusing on emerging
corporate trends such as Corporate Governance, Gender Concerns, Quality Control in
products, E-Procurement, Global Competitive Technology Strategy etc.
��� !�� TI� ��''��(��� ��� ����) � ��� ���������$� ;�� ��� ''� ���(��''�� "'����(� ���eagerly looking forward to the mission of changing from the era of General Administration
��T�*��I����������(�*���<����(� �� ���<���"���������"��='��� �����<'���Enterprises in India.
ENVIRONMENT PROTECTION AND CONSERVATION
Environment Protection and conservation has commanded due attention as a result
environment management system has been developed as integral part of Company’s
��=��������<��'���������������"��������*��'��!�"�����������+����"��������"��taken at the various work sites in compliance with such procedural requirements covers:
1. Engagement of National Productivity Council (NPC) for carrying out exhaustive
energy audit.
?�� I�Y������������*����������!�'�����!��������'�"'��$����������
3. Tree plantation at factory sites & measures for restricting cutting of trees.
O�� �=������� �!� ���� �G���� <�� ��"��(� ���� "��=������ ����*� ��� *���\���''��C���������!������(���(���������"��"�����������(�������������
R�� S������"�������*��(�����"��"��������
6. Installation of necessary safety measures at factory premises.
The Company has continued its efforts to conserve the energy to highest possible
level. The Company has formulated a long-term vision for embracing new technologies
covering use of renewable form of energy. The Company is also developing the concept
of environment friendly green building in all its upcoming projects.
55
REPORT ON CORPORATE SOCIAL RESPONSIBILITY
The Company has been discharging its social responsibility by participating in various
social welfare schemes. In order to provide a complete framework and platform for greater
participation and to align it to DPE guidelines and other International standards such as
United Nations Global Compact Principle, the Corporate Social Responsibility policy and
plans have been framed and designed.
As part of its CSR initiative, a sum of ` 4.68 lacs has been spent in Rajasthan through
Jansankhya Sthirata Kosh (JSK) for bringing awareness among the people about
population stabilization. Kisan Vikas Patras (KVPs) have been distributed to the eligible
couples who have undergone sterilization after having one or two children. Another CSR
initiative was taken-up through Bhagwan Mahavir Viklang Sahayata Samiti (BMVSS) for
��'"��(����<'���"�����������(���*�<�'��������(����<��"��=����(���*������'�'�*<�$��'�"����������������V?W�"�����;����"��=����������'�'�*<��;��'���AR�"�����;����provided calipers at a cost of ` 10 lacs during the year 2011-12.
����) ����'���������������;�����!��*"��=�*����!����������*�������!�������connecting U.S. Gymkhana, ISP with Nashik – Pune Highway and Jail Road side at
Nashik (Maharashtra) at cost of ` 89.68 lacs through Divisional Commissioner, Nashik
during 2010-11 and 2011-12. An additional amount of ` 19 lacs has been sanctioned for
this project during the current year.
����) ����������������C"���������!�` 294.66 lacs towards construction of 9 primary
schools in Murshidabad District of West Bengal during the year 2011-12. CSR programme
for rain water harvesting system and sanitation project was undertaken at cost of ` 20
lacs through Indian Red Cross Society, Mumbai during year. Blood donation camps were
��(��G����������!�''��<������) � ��� ���M����� )��$�%����$� )&�$���'�����D%�$�Dewas during year 2011-12.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis Report describing the company’s
objectives, projections and expectations may be ‘forward looking statements’ within the
meaning of applicable laws and regulations. Actual results might differ substantially
or materially from those express or implied. Important developments that could affect
��*"��L�� �"������� ���'����� ��(������ ���(��� ��� �����*��� ��=����*��� ��� )���$��C���(�����P�������$�C�';�$�'��(��������'<������'�����
56
ANNEXURE-V
REPORT ON CORPORATE GOVERNANCE
1. THE COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE
Corporate Governance refers to set of laws, regulations and good practices that enable
�����(��G������"��!��*��!�����'���������''��(������'��(���*�;�'����������='��� !��� ''� ��� �����'������ �������� ������(� ��� �����(� ���"������ )���� �*����(‘SPMCIL’ or ‘Company’) believes in the principle of sound corporate governance. At
���) ����"����(�=�����������*�������"���$����"����=�$�����Q��<'����������while taking care of stakeholders. It consistently endeavors to achieve high standards
of corporate governance for enhancement of long term stakeholder’s value. As a good
corporate citizen, the Company is committed to sound corporate practices based on
����������$��"������$�!������$�"��!������'��*���������<�'������<��'���(�����������*��(�''���������'�����!�������=��(������<'��'��(���*�(��;�����"���<�'���
2. BOARD OF DIRECTORS
Composition of BOD:����"������"��=��������!�����'����!������������!�����) $����Board consists of ten members, of whom four are functional directors, including Chairman
and Managing Director, three are Nominee representing various government departments,
and three are independent directors. As per articles of association, the power to appoint
Directors vests with the President of India. In terms of the articles of association, the
strength of Board shall not be less than three Directors and not more than ten Directors.
Category, attendance at Board Meeting, AGM & number of other Boards or Board
Committees in which directors hold position as a member or chairperson during the year
2011-12 are as under:
Name Meeting
held during
respective
tenures of
Directors
No. of
Board
Meetings
attended
Attendance
at the
last AGM
(held on
10.08.2011)
No. of other
directorship
held as on
31.03.2012
(a) Functional Directors
Shri M. S. Rana
Chairman & Managing Director
DIN – 01174242
8 8 Yes 1
Shri Ashwini Kumar
Director (Technical)
DIN – 01488057
8 8 Yes 1
Shri Madan Mohan*
Director (Finance)
DIN – 01467408
5 5 Yes %)
57
Name Meeting
held during
respective
tenures of
Directors
No. of
Board
Meetings
attended
Attendance
at the
last AGM
(held on
10.08.2011)
No. of other
directorship
held as on
31.03.2012
Dr. Manoranjan Dash
Director (HR)
DIN – 02071641
8 8 Yes %)
(b) Govt. Nominees
Shri Bimal Julka
Director General,
Directorate of Currency,
Ministry of Finance,
DIN – 03172733
8 8 Yes 1
Shri H. Pradeep Rao
Joint Secretary & FA,
Ministry of Finance,
DIN – 03042828
8 7 Yes 1
Shri K. Skandan
Additional Secretary,
Ministry of Home Affairs,
DIN – 01945013
8 6 Yes 1
(c) Independent Directors
Smt. K.J. Udeshi
Director (RBI Nominee)
DIN – 01344073
8 7 Yes 3
Shri Muktesh K. Pardeshi
Joint Secretary (PSP) & CPO,
Ministry of External Affairs,
DIN – 03366751
8 7 Yes %)
Smt. Devika Kumar**
DDG (Philately),
Department of Posts,
DIN - 02769069
3 1 No %)
Smt. Meera Handa***
DDG (Philately),
Department of Posts,
DIN – 03623187
5 4 No %)
*����*����* ������"��������� !��� ��M��=�<=������ ���������� �� ���������������NN*��4�"�>�,�������"��������� !��� ��O�=O�<=������ �����J�������� !�������NNN*��*����3�������$���� ���������44/6'�������#8�4����� !' �� ��O�=O�<=�� ������� !*��4�"�>�,�����
58
Number of Board Meetings & Dates: The Board of Directors met (8) eight times
during the year 2011-12 (27.04.2011, 29.06.2011, 10.08.2011, 09.09.2011, 11.10.2011,
05.12.2011, 26.12.2011 & 22.03.2012) and all the information as required to be placed as
per the DPE Guidelines was placed before the Board.
Appointment / re-appointment in the Board: During the year 2011-12, Mrs. Devika
��*�$�EE&�����'�'��$�E�"�*����!�����=���� ����!�����!�E��������!�����) �on 18.08.2011 due to relinquishment of charge of DDG (Philately), Deptt. of Post. Shri
��������$�E��������S�������'���=��������!�������S������'�E�����������to repatriation to his parent cadre on 13.10.2011. Mrs. Meera Handa, DDG (Philately),
Department of Posts J���������D�����!�����) ����"'����!�����E�=�����*�������(�the year 2011-12 on 18.08.2011.
��<���!�"���'���!����E�����������!������������������Z
� Shri M. S. Rana, Chairman & Managing Director
Mr. Rana aged 53 years is a graduate in Civil Engineering from Thapar Institute of
Engineering and Technology, Patiala, being overall topper and gold medalist. He
has also been awarded the Chancellor’s Medal of Excellence for the best student
of the University. Mr. Rana has also done Post graduation in Project Planning and
Management from The University of Bradford, UK in 1999-2000 with scholarship
from the World Bank. Mr. Rana has been awarded the outstanding Alumni award
by Thapar institute of Engg. and Technology Patiala in 2006.
� ����� I�� ��� ;������ ��� F�(������� )���� ��� !��*� ��'�� �N��� �� ����� �N�O��Thereafter, he served in Indian Railways in various capacities from Asstt. Engineer
to Chief Engineer (SAG) for 21 years. He has completed a number of mega
projects on Indian Railways. From August 2005 to March 2009, Shri Rana worked
as Director/Works, Konkan Railway, wherein he was instrumental in carrying out
geo safety works in tunnels & cuttings for safe train operations. He was also in
���(���!�����I�'����J���������I�������=�������E$�����) ���������?AAN�������I�����'�������*���!����D���%����"�����''�)�����=�� ����D%��)� ���Shri Rana has published a number of articles on infrastructure.
� Shri Ashwini Kumar, Director (Technical)
Shri Ashwini Kumar, Director (Technical), a Post Graduate (Electronics) Gold
Medallist from BITS, Pilani is having experience of 35 years in diverse technical
��'���� �!��� <���(� ��'����� ����(�� )����� F�(�������(� ���=����� �F'���������$��NWO��C*���)�����%='���**������=����������#!����$�������<�������th General Manager, Naval Armament Depot, Alwaye, Kerala. He is NDC Alumini
(36 Course, 1996-97) & was awarded Chief of Naval Staff Commendation for
induction of Aerial Dropped Torpedo in Indian Navy capping technical competence
as Guided Weapon Specialist of various Missiles, Mines etc., besides other Naval
Armaments. He had established Naval Armament Depot, Sunabeda, Orissa as
���� E&�� \� T�E� �!� ��� E�"�� �����(� �N�]K�W�� T�� �*�� ��� ��"����� �����(���'�$� ?AA?� �� �������� �!� S������ ��� ��� ������� ����) � ������ ��� ����"�����
59
A Performance driven, versatile and analytical with practical hands on approach
always perseveres to achieve immaculate results with swiftness. He has worked as
General Manager of Security Paper Mill, Hoshangabad, Bank Note Press, Dewas
���)����&�=���*������$�%����<�!����J�����(�����) ������(��$�?AA]�
� T������E�������������D�����!�D%��)� $�D�('���$�;���������RAZRA��U���*"����!�����) ����DID%�� ����<��������!�ID)��
� Dr. Manoranjan Dash, Director (HR)
� E���E�����������L����(������� <����H�'!���!��*�M�'�M��=������������E��in Manpower Policy and Practices in Petroleum Industry of India. He was deputed
<��E�"�*����!���<'���F���"�����$�&�=���*����!�)�������U�% �!�����������Executive MBA in Europe conducted by International Centre for Public Enterprises
�)��F��'�������� J�<'J����'�=�������������J�����(�������D�����!�����) $�E���E���;�����FC����=��E��������TI��!����R�*��������T�+� �*���$�D�('�����T��;������������&����'���(����TI�����U������������%�(*� �*�����U�% �����"���� #!���$� ��*<�� "����� �� ���(��� �����=��*��� �!� ���+�'���*� (���;�����;���%=�����M��E���E������;���������U�% �!���*�����������������'����(���������'!������;���+�&���"��;����U�% ��T��;��'��������(�as a Professor in ICFAI Business School, Mumbai and had immensely contributed
towards the human resource aspect of business to multifarious Industries as a HR
���!������'��������������������'��VA������<������ <������*�����������������������!� <���$�&�=���*����!�)�������;����'���(��*"����"�����������Delhi & Mumbai as Assistant Commissioner, he also served as a regular Faculty
��*<����!�U�U�&����%���'� <����)���������E�'����)������'�I�'��������)���������;����"��������=��(���!�����������"�<'������<��&'�<'�D��������Press is one of the important publications of Dr. Dash.
Dr. Dash was conferred with the honour and distinction of “Most powerful HR
professionals in India” by Employer Branding Institute in Singapore on 23rd July,
2010.
� Shri Bimal Julka, (Govt. Nominee, Ministry of Finance)
Shri Bimal Julka did his MA in Psychology from Delhi University. He was awarded a
fellowship at the Queen Elizabeth House, Oxford University and wrote a thesis on
Small and Medium Enterprises (SMEs). Belonging to the 1979 batch of the IAS, Shri
Julka has held many prestigious positions in Government. He was Director, Ministry
of Industrial Development, Government of India (1989-94), Private Secretary to
Union Minister for Human Resource Development (1995-96), Director, Ministry
of Civil Aviation (1996-98), Commissioner, Gwalior Division (2000-03), Secretary
(G/Air), Ministry of Defence (December 2004-09) and Resident Commissioner,
Government of Madhya Pradesh (2009-10). He is currently holding charge of
Additional Secretary and Director General, Directorate of Currency, Department of
Economic Affairs, Ministry of Finance, Govt. of India. He is also Nominee Director
������D�����!�#�'���%��'�&�����"������ ����#%&���������%�=�*<���A�$�2010.
60
� Shri H. Pradeep Rao, (Govt. Nominee, Ministry of Finance)
Shri H. Pradeep Rao has been appointed as Government Nominee Director on the
D�����!�����) �<�����&�=���*����!�)����;���!��N������$�?A�A��������'�$�Shri H Pradeep Rao is the Joint Secretary and Financial advisor to Goverment of
)���$����������!�S�����$�%�;�E�'����T������D�$��������)�����������)����'����������T�� ����� )�����������������������=���� �)������#!������!� ����N���batch. He has held key positions, including Accountant General of the State of
�**�������*��$�������"'�E��������I�"���$�����'�$�#!�����!������*"��''���& Auditor General of India, New Delhi, Director of External Audit, World Health
Organisation (WHO), Geneva, Switzerland, Member Audit Board and Principal
Director of Commercial Audit, Chenai, Principal Accountant General West Bengal
and Director General of Audit (Central Expenditure), New Delhi. He is also a
Director on the Board of Syndicate Bank.
� Shri K. Skandan, (Govt. Nominee, Ministry of Home Affairs)
Born in December 1956, Shri K. Skandan has done Masters in Political Science,
D� ��!��*������M��=�������������&����������I��'�E�=�'�"*����'����(�from University of East Anglia, United Kingdom. Joined IAS in 1982 and allotted
to Tamil Nadu Cadre, he has held several senior positions in the State, including
that of Collector, Nagapattinam, Director-Agriculture, Commissioner-Industries,
Registrar, MGR Medical University, Principal Secretary-Industries, Government of
+*�'�%��j���E$�+*�'�%���%�;�"���� ��$�����*�$�+*�'�%���F'��������D���$� FC�� #!����� ����*�� +��� ��$� �EKH�*��� E�=�'�"*��� ���"�����$�etc. Presently Shri Skandan is Additional Secretary in Ministry of Home Affairs and
���&�=����*�����E�������!��*��T��������D�����!�����) �
� Smt. K.J. Udeshi, (Independent Director)
Smt. Kishori Jayendra Udeshi has M.A. Degree in Economics from Bombay
University. She had been the Deputy Governor of the Reserve Bank of India
from June, 2003 to October, 2005 and was on the Board of SEBI, NABARD and
Exim Bank. She has also functioned as Chairman of Bhartiya Reserve Bank Note
�������=�� ����DID%�� �$�D�('�����������*���!����E�"����)��������and Credit Guarantee Corporation. She had also been the Chairman of the
Banking Codes and Standards Board of India, set up by RBI to evaluate, oversee
and enforce the observance of Banking Codes. She is a member of the Court of
Governors of the Administrative Staff College of India, Hyderabad, a nominee of
the Government of Maharashtra on the Board of the Indian Red Cross Society,
��*<������������"�������(�ID)������*�����*������������D�����!�����) �
� Shri Muktesh K. Pardeshi (Independent Director)
Shri Muktesh K. Pardeshi has been appointed as customer nominee Director on
���D�����!�����) �<��������������!�FC���'��!!����;���!��V�%�=�*<���?A�A��Born in 1966, Shri Pardeshi holds a Master of Arts degree in Sociology from the
E�'��������'��!�F����*��������E�"'�*�����"����� �(�(��!��*����%���'�Autonomous University of Mexico. He joined Indian Foreign Services in 1991.
61
������'�$������������������������"�����=����J�����������!����"���#!�����in the Ministry of External Affairs, Government of India. Earlier, He served as
Minister/Deputy Head of Mission at the Embassy of India in Jakarta (2007-10) and
Counselor at the Permanent Mission of India to the Conference on Disarmament
in Geneva (2004-07). During 1993-01, he worked with Indian Missions in Mexico,
Colombia and Nepal (where he also held the position of the Secretary of B. P.
Koirala India-Nepal Foundation). In 2001-04, he was Deputy Secretary (South
F�������������������������������!�FC���'��!!���$�%�;�E�'���
� Smt. Meera Handa, (Independent Director)
� �*�������T��$�E�"���E�������&����'�����'�'��$�������!������!�����N�?�batch of the Indian Postal Service. She has served the Department of Posts in
various capacities in Uttar Pradesh, Rajasthan and Delhi Circles and also as Director
(Philately), Deputy Director General (Postal Operations & Corporate Planning).
She has been appointed as a Customer Nominee Director from the Department
�!������������(����� )���"������E���������� ���D�����!�����) �;���!��18.08.2011.
3. AUDIT COMMITTEE
Brief description of Terms of Reference
1. Discussion with Auditors periodically about internal control systems and the scope
of audit including observations of the auditors.
?�� I�=��;��($� ;��� ��� *�(�*��$� ��� Q����'�� �����'� ��*���� <�!����submission to the Board for approval.
3. Ensure Compliance of Internal Control Systems.
O�� #=����(���!� �����*"��L�������'� ��"����(�"���������� �������'�������!� ��������'���!��*�����������������������'���*������������$���!���������credible.
R�� %���(�""���*��������*�='��!��C���'���������I���**�����(�����C����of audit fee of external auditors and also approval for payment for any other
services.
]�� I�=��;��($� ;��� ��� *�(�*��$� ��� ���'� �����'� ��*���� <�!����submission to the board for approval, with particular reference to:
a. Matters required being included in the Director’s Responsibility Statement to
be included in the Board’s report in terms of clause (2AA) of section 217 of the
Companies Act, 1956;
b. Changes, if any, in accounting policies and practices and reasons for the
same;
c. Major accounting entries involving estimates based on the exercise of judgment
by management;
62
��� ��(������ �J��*���� *��� ��� ��� �����'� ��*���� �����(� ��� �!� ���������(�j
��� ��*"'�����;���'�('���Q����*������'��(��������'���*���j
f. Disclosure of any related party transactions;
(�� v�'����������������!�������"���
7. Reviewing, with the management, performance of statutory and internal auditors, the
adequacy of internal control systems and suggestion for improvement of the same.
8. Reviewing the adequacy of internal audit function, including the structure of the
�����'�������"�*��$��!��(��������������!�����!���'������(������"�*��$�reporting structure coverage and frequency of internal audit.
N�� I�=��;��(� ��� �����(�� �!� ��� �����'� ��=���(����� <�� ��� �����'� ������� ����matters where there is suspected fraud or irregularity or a failure of internal control
systems of a material nature and reporting the matter to the Board.
10. Discussion with statutory auditors before the audit commences, about the nature and
scope of audit as well as have post-audit discussion to ascertain any area of concern.
11. Review of Observations of C&AG including status of Government Audit paras.
�?�� )�=���(�����������*��������'�����������*���"�������<�=�������!����������by the Board.
13. To review the follow up action taken on the recommendations of Committee on Public
Undertakings (COPU) of the Parliament.
14. Provide an open avenue of communication between the independent auditors,
internal auditors and the Board of Directors.
Composition as on 31.03.2012: The Audit Committee was constituted in accordance with
the Guidelines on Corporate Governance issued by Deptt. of Public Enterprises. The terms,
reference, role & power are in accordance with prescribed Guidelines.
Name, category & attendance:
Name Designation Category Meeting attended
Smt. K.J. Udeshi Chairperson Independent 5/5
Shri H. Pradeep Rao Member Nominee, JS & FA,
Ministry of Finance
5/5
Shri Muktesh K. Pardeshi Member Independent 3/5
Smt. Devika Kumar* Member Independent 1/3
Smt. Meera Handa** Member Independent 2/2
Shri Ashwini Kumar Member Executive 5/5
x� �*�� E�=��� ��*�� ��� =���� ��� �!���� ��� ���A��?A��� ���� �� ��'��Q����*��� �!� ���(�� �!� EE&�(Philately), Deptt. of Post.
xx� �*�������T������<����""��������E��������!�����) �������A��?A������"'����!��*��E�=�����*��
63
Meetings and Date of Meetings: +����=��*����(���!������**���������������'�����2011-12 have been held on 27.04.2011, 28.06.2011, 09.08.2011, 05.12.2011 & 22.03.2012.
4. REMUNERATION COMMITTEE
Brief Description & Composition: The constitution, tenure, remuneration of the
functional directors is decided by the President of India. In compliance of the mandatory
guidelines on Corporate Governance issued by DPE, a Remuneration Committee of the
Board of Directors of the Company is constituted by the Board in its 21st meeting held on
15th May, 2009 for Performance Related Pay (PRP) of the Executives of the Company.
Further, the Remuneration Committee has been reconstituted from time to time and as per
last reconstitution in the 41st Board meeting held on 9th September, 2011, the committee
comprises the following Directors:
Name Designation Category Meeting attended
Smt. K.J. Udeshi Chairperson Independent 1/1
Shri H. Pradeep Rao Member Nominee, JS & FA,
Ministry of Finance
1/1
Shri Muktesh K. Pardeshi Member Independent 1/1
Smt. Devika Kumar* Member Independent 0/1
Smt. Meera Handa** Member Independent -
N ���� 4�"�>� ,���� ��� "������ ��� !��� � �O�=O�<=�� ��� � �����J�������� ! ������ ! 44/6'�������#8�4����� !' ���
NN ����*����3�������$������ �������4����� � ��O�=O�<=��������� !*��4�"�>�,�����
Meetings and Attendance: During the year 2011-12, one meeting of remuneration
committee was held on 24.08.2011 and the members were present as above in that meeting.
The details of gross remuneration paid to the Functional Directors of the Company during
the year 2011-12 and 2010-11 are as follows:
(Amount in `)
Particulars 2011-2012 2010-2011
Salary and Allowances 10,484,910 9,708,971
Contribution to PF/ Pensionery Charges 441,062 606,940
�=��F����*�� 1,471,913 249,389
����I�����#��������� 4,167,635 3,941,427
Gratuity 553,555 589,785
Total 17,119,075 15,096,512
No remuneration is paid to the non-functional Directors of the Company.
64
5. GENERAL BODY MEETINGS
Venue, Date and Time of Company’s AGM of last 3 years with Details of Special
Resolutions passed:
Particulars 2008-09 2009-10 2010-11
Date September 15, 2009 August 25, 2010 August 10, 2011
Time 12.00 noon 12.30 pm 1.00 pm
Venue 16th Floor, Jawahar
Vyapar Bhawan,
Janpath,
New Delhi-110 001
16th Floor, Jawahar
Vyapar Bhawan,
Janpath,
New Delhi-110 001
16th Floor, Jawahar
Vyapar Bhawan,
Janpath,
New Delhi-110 001
Details of Special
Resolutions
passed in the AGM
None None None
Details of Annual General Meeting in the current year:
Year Date and Time of AGM Venue
2011-12 September 27, 2012
at 1:00 pm
16th Floor, Jawahar Vyapar Bhawan, Janpath,
New Delhi-110 001
6. DISCLOSURES
(i) The Company does not have any material related party transactions, which have
"����'����P���;��������*"����'�(���E���'���������(����(����������;���the related parties are given in the Notes to Accounts of the Financial Statements
for the year ended 31st March, 2012.
(ii) There were also no instances of non-compliance on any matter during the last
�����������)������!��*��������"��'�����*"�����������������"�����(����the Company by the statutory authorities except the cases mentioned in notes to
�������!��*��(�"���!���������'���*����������"��'��!�����*�������''�pending with the judicial and quasi – judicial authorities.
(iii) Company has reiterated the Whistle Blower Policy of CVC and no person has
been denied access to the Audit Committee.
(iv) The company is complying with all the requirement of the Guidelines on Corporate
&�=�������!������F���������<�����E�F�������C�����P������������
(v) No Presidential Directives issued during the year and last three year.
(vi) During the year, no expenditure is debited to the books and accounts which are not
for the purpose of business expenditure.
65
(vii) During the year, no expenses which are of personal nature have been incurred for
the Board of Directors and Top Management.
�=����� +���"�����(���!���*������=������!�����C"���������"�����(���!� �'��C"���������R�W]B���������'��C"���������"�����(���!��'��C"���������%�'�������������������'�����
7. MEANS OF COMMUNICATION
Quarterly Results / Annual Results: +�����*"�����(�'�'�����*��������������'�����'�$� �**����'��!�������������������������\""��=����+����������'�����'��are published in the leading English and vernacular dailies having wide circulation.
News Release, Presentation etc.: +����!���'���;����'����$�"���������$������'�results etc. are displayed on the Company website www.spmcil.com
Website: The Company’s website www.spmcil.com������'���!��*���$�������!��������and other related information is also available on the website.
8. AUDIT QUALIFICATIONS
The comments on accounts for the year ended on 31st March, 2012 by the Comptroller &
Auditors General of India under Section 619(4) of the Companies Act, 1956 and Statutory
Auditors of the Company are given in the addendum to the Directors Report along with
the comments of the company.
9. TRAINING OF BOARD MEMBERS
The Company has applied informal training of Board members by way of providing regular
updates about the performance of the company, Governments directions, Corporate
Governance guidelines from time to time.
10. WHISTLE BLOWER POLICY
The Company is committed to conduct its business in accordance with highest standards
of business ethics and ensure compliances of all applicable laws, rules and regulations.
The Board of Director has laid down the Code of Business Conduct and Ethics for the
Board members and Senior Management of the Company. The copy of the Code has
been displayed on the Company’s website www.spmcil.com. All members of the Board
������������(�*����=�������*�����*"'������!�������!�������� !��� �������?A��K�?������) ���� �������� ���H���'��D'�;�����'�����!� ����U��=���� '����%�������) \U�(\V\AN\AW\R�WR������]�AV�?A�A�
11. COMPLIANCE CERTIFICATE
This Report duly complies and covers all the suggested items as mentioned in Annexure–
VII��!� ���&����'������+������������<����� !��*� ���"������(���*"�����������regarding compliance of conditions of Guidelines of Corporate Governance of CPSEs
has been annexed to the Report.
66
DECLARATION BY CHAIRMAN-CUM-MANAGING DIRECTOR REGARDING COMPLIANCE WITH THE CODE OF CONDUCT BY BOARD MEMBERS AND SENIOR MANAGEMENT DURING THE FINANCIAL YEAR 2011-12.
C�� * � 7���� ��������;���;*������� 4����� � ! �������# '������� ��� *������� �� ���� � ! ����� +������ ����$# � ���� ���� ��� � ����# ��� $������ !� � ������$��� !���I ���������� �*������������!������ ��������#��"�� ������&������� �� !� �����! �4����� ��������� �*������������������ !�����������#���<=��;�<�E
Sd/-
Date: September 27, 2012 (M.S. Rana)
Place: New Delhi Chairman & Managing Director
DIN – 01174242
67
AGB & ASSOCIATESCOMPANY SECRETARIES
==========================================================================
CORPORATE GOVERNANCE CERTIFICATE
To
The Members,
Security Printing and Minting Corporation of India Limited
16th Floor, Jawahar Vyapar Bhawan,
Janpath, New Delhi-110 001
We have examined the compliance of the conditions of Corporate Governance by Security Printing
and Minting Corporation of India Limited, (hereinafter referred as ‘the Company’) for the year
ended on 31st March, 2012 as stipulated in ‘Guidelines on Corporate Governance for Central Public
������F���"�����$�?A�AL�=����%��������%�����%��������\?AARK&�����(��''������������??�A]�?AAW������=�����(����'�����=�����!����*�*�����*������O����$�?A�A�<�����E�"�*����!���<'���Enterprises, Ministry of Heavy Industries and Public Enterprises, Government of India and annexures
mentioned there under (hereinafter referred as ‘Guidelines’).
The compliance of conditions of corporate governance is the responsibility of the Management. Our
examination was limited to procedures and implementation thereof, adopted by the Company for
ensuring the compliance of the conditions of corporate governance as stipulated in abovementioned
(����'������ )� ��� ������� �� ���� ���� �� �C"�������� �!� �"������ ��� ��� �����'� ��*���� �!� ���Company.
In our opinion and to the best of our information and according to the explanations given to us,
we hereby certify that the Company has complied with the conditions of corporate governance as
stipulated in the abovementioned Guidelines.
We further state that such compliance is neither an assurance as to the future viability of the Company
��������!���������!�����!!���=������;���;����������(�*������������������!!�����!����Company.
Place: New Delhi
Date: August 23, 2012
For AGB & Associates
Company Secretaries
Sd/-
(Nitin Rawat)
ACS: 28809; CP: 10554
�������� : 1st Floor, 970, Sector-21D,
Faridabad-12001, NCT of Delhi)������Z�(�(J�?O>����������
(<�������>��������Tel – 0129-4080970, 9811386723, 9873186723
==========================================================================Branch Off: D-93, Rosewood City, Sohna Road, Sector-49-50, Gurgaon-NCT of Delhi
68
AUDITORS’ REPORT
To,
The Members,
��������������(���������(����"�������!�)���� �*���16th Floor, Jawahar Vyapar Bhawan.
Janpath, New Delhi-110001.
A. We have audited the attached Balance Sheet of M/s Security Printing & Minting
���"�������!�)���� �*�������V�st�����$�?A�?����'��������*����!�������� �����������!�������������������������+����������'���*����������responsibility of the Company’s Management. Our responsibility is to express an
�"�������������������'���*����<���������������
B. We conducted our audit in accordance with auditing standards generally accepted
in India. Those standards require that we plan and perform the audit to obtain
�����<'����������<���;��������������'���*�������!�����!�*���'�mis-statement. An audit includes examining, on a test basis, evidence supporting
��� *����� ��� ����'������� ��� ��� �����'� ��*�������� ���� '��� ���'������������(� ��� �������(� "�����"'��� ����� ��� ��(������ ���*��� *��� <�� ���*�(�*��$���;�''����='���(�����=��''������'���*���"����������H��believe that our audit provides a reasonable basis for our opinion. Our report has
taken into consideration the audited accounts and Branch Auditors Report of 9 units
(Bank Note Press, Currency Note Press, Security Printing Presses, Government
Mints and Paper Mill) appointed by the Comptroller & Auditors General of India.
C. As required by the Companies (Auditor’s Report) Order, 2003 as amended by
Companies (Auditor’s Report) (Amendment) Order, 2004 issued by the Central
Government of India in terms of sub-section (4A) of section 227 of the Companies
Act, 1956 and on the basis of such checks as we considered appropriate and
according to the information and explanation given to us and reports of branch
������$� ;�� ���'���� ��� �������C���� � ������� ��� ��� *���� �"������� ���paragraph 4 and 5 of the said order.
D. Further to our comments in the annexure referred to above, we report that:
(i) During the year the company has revised the sale price of coins sold to Ministry
of Finance. However, the Ministry of Finance has decided the payment to be
released provisionally at the rates different from the selling price billed by the
company.
(ii) Some cases relating to the employee claims as well as indirect tax matters are
pending in different courts relating to the period prior to the incorporation of the
company (10th February, 2006) & thereafter also. In the absence of complete
SERVA ASSOCIATESCHARTERED ACCOUNTANTS
����������� ���������������������������������������������� ��!��"��!��##$$$%�&!��$##'(�%$��((���%)��*�����+��,���++���-�+.�*�����*�����+�-���///�+��,���0
69
���'�$���� �<�'������'����(������(��� �<�'��������*���!�����������'��(�to the Company as well as Government account cannot be ascertained.
(iii) Trade Payable to vendors registered under MSMED Act, 2006 have been
�����������'���)&��%�������%��%����$���;�=��������<������!��*�����there is no major delay in outstanding payment to the same. In the absence of
��!���������'��"'����<�!������$�;�������<'������**����������*��
E. In our opinion proper books of accounts as required by law have been kept by the
company so far as appears from our examination of those books and proper returns
adequate for the purpose of our audit have been received from the branches not
visited by us.
S�� D�����������=��������������������;���;�������������*���������Z
a. Business Takeover w.e.f. 10th February, 2006
i. That as per the Takeover Agreement dt. 10-02-2006, all the assets &
liabilities of 9 Government Units were taken over by the company at their
Book Value subject to Finalization of the Transfer Value within 6 Months,
however even after more than 6 Years, the same have not been Finalized
resulting into the uncertainty in the value of the business transferred to
the Company appearing under the Head “Funds from Government of
India (Adjustable)” amounting to Rs. 28,79,66,99,342 thus the Performa
������� ��P����(� ��� *���� "�<'�� �� (�=���*��� �!� )���� �������(������!���������� �<�'����� ��'��(� �� ����Q�������� !��*� ���Government of India are subject to Finalization and Audit.
���� +�$����^S���L��!��*�&�=���*����!�)�������J��<'��������`��(����taken initially as on 09th�S�<����$�?AA]�������(�����(�����'������to adjustments entries passed during the last 6 years. The slow process
�!�"�����'�=����������!� ��=��������;�''���S�C���������"�� !��*�=����������!�������������'�<�'�����!������"������"��������Ath February
2006 and also due to unclear demarcation as to the liability arising for
the earlier period not provided and short/excess provision made in earlier
years etc. and thus number of adjustment entries have been passed since
takeover. The adjustment/settlement of the Final Account will also affect
the Capital Structure of the Company.
iii. In the absence of the determination of the nature of the amount (Share
�"�'\ ��\&���� ���� �� ��� &�=���*��� �!� )���$� ��� ^S����� !��*�Government of India (Adjustable)” Account has been shown as a separate
line item on the face of the Balance Sheet between the Share Holders
S�������%��K������� �<�'�����
&�� H���=�������=�����"��������������!�<������!�����������<���������������and the same have been dealt with by us in our report.
T�� +���D'��������$���*����!��������� �����������������S'�;���*���dealt with by this report are in agreement with the books of accounts and with the
�����������'��!��*����<�������
70
)�� )�������"�����$����D'��������$���*����!��������� �����������������Flow Statement dealt with by this report comply with the accounting standards
referred to in sub-section (3C) of section 211 of the Companies Act, 1956 except for:
a. �������������� !��� ��������������� �4���� ���� !��� ������' ������
i. Based on the reports received from the Branches, we are of the opinion
that there is a need for greater uniformity in the Accounting Policies as
;�''��������'�����'������"�����!�''�;���<�����D�������
ii. The Company is generally following the Accrual System of Accounting
except for Accounting for income from forgery detection charges, ex-gratia,
recoveries from employees for use of amenities, insurance, other claims
and last pay of employees. Further for the purpose of salary payment,
the company is following Financial Year period from March to February.
However suitable disclosure of the same and consistency throughout the
units could not be reported.
b. �������������� !��� ��������������< ������� � !��"��� �#
i. The Inventory of Work in Progress and Finished Stock has been valued
at the Budgeted Cost and the same is subject to reconciliation with the
Actual Cost of Production.
ii. Valuation of commemorative coins & medals is based on last sales price
less 9%, which is not as per the Accounting Standard 2.
iii. All the Inter Unit transfers are made at the Budgeted Cost only & hence
valuation of inventory pertaining to same has also been made at Budgeted
Value.
�=�� +���&�'����'������!����������!�ID)������<J����������*����!��*����Ministry and RBI.
c. �������������� !��� ��������������� �?��'� �� �+ ��! ����'��� ��'�� �'��� ��������������������� ������' �������
i. Provision towards accrued income/expenditure is not being made properly
resulting into amount being shown over the years as prior period income/
expenditure. As per the provisions of income tax unless it is proved that
the liabilities crystallized in the subsequent year, the same cannot be
allowed as expenditure. Similarly any income pertaining to previous Year,
results into reopening of the case for the related previous year. Since
proper adjustment have not been made in the computation of income
in the previous income tax returns the same may result into additional
income tax & penalties for which no provision is made.
ii. Consumable stock in case of SPM Hoshangabad, has been charged
to Prior Period Expenses for Inventory Adjustments amounting to
`2,44,25,287 pertaining to the period 10-02-2006 to 30-06-2011. However
the expenses pertaining to the period 01-04-2011 to 30-06-2011, being
������������C"�����������<�����������������������"��'��
71
d. ����� �� ������� ! ��� ������ �������� � � ������� � ��� ������ ! �Depreciation
i. The Gross Block & Accumulated Depreciation of Fixed Assets has been
shown at the Historical Cost of Purchase and Accumulated Depreciation
up to the date of transfer from the Government of India as appearing
in the Books of the Vendor as against cost to the company. Since the
E�"�������� ��� <���(� �'�*��� ��� ���(�� ���� ������ ��� ��� &�����cost of the Asset to the previous vendor instead of cost to the company
meaning thereby that the remaining life of the asset was not disturbed. In
the absence of determination of the useful life the amount of depreciation
�'�*�������\�C��������'�����<��Q�������
ii. The unit SPM Hoshangahad is working on triple shifts but charging
depreciation as per the rates given for single shifts operations under the
Companies Act 1956. This has resulted in understatement of depreciation
& overstatement of the Fixed Assets to the extent of difference in the
rates of depreciation. In the absence of the details the amount of shortfall
in the depreciation charged could not be ascertained.
e. �������������� !��� ��������������� ���� ������! �7�"����7�� ����� �
i. The Sale Price of the Currency Notes sold to RBI is subject to approval
by them. As informed to us, till date the RBI has been releasing payments
���"��=�����'�<������������'��'���"�����*��!!������"�����!������*"����)�����<�������!�����'�������$�����*"���!�����*�����'��not be ascertained.
ii. The Sales Price of Coins sold to Ministry of Finance, Government of India
was only approved up to Financial Year 2007-08. As informed to us, till
date the Ministry of Finance has been releasing payments on provisional
<������� �����'��'���"�����*��!!��� ���"�����!� �����*"���� )����� <������ �!� ��� �'�������$� ��� �*"�� �!� ��� �*�� ���'�� ��� <��ascertained.
iii. The Sales Price of Postal Stationary, is different from the rates determined
by the Cost Accounting Branch, Ministry of Finance, Government of India
in the Financial Year 2006-07. As informed to us, the amount receivables
!��*�������'����������������<J����������������*���������"�����The value of Sales of postal stationary may undergo change, in case the
"���������������"��\�����*���<��������'������������)�����<�������!�����'�������$�����*"���!�����*�����'�����<�����������
iv. Further the Sales is recognized at the time of dispatch of the Goods,
however as per the terms of sale, the risk & reward is transferred at the
time of receipt and acceptance of the same by the Customer.
f. �������������� !��� ���������������= ���� ������! �:�L��������
i. The Gross Block & Accumulated Depreciation on Fixed Assets has been
shown at the Historical Cost of Purchase and Accumulated Depreciation
72
up to the date of transfer from the Government of India as appearing in
the Books of the Vendor as against cost to the company. To that extent
the Gross Value of Fixed Assets are overstated.
���� E����(�"�����'�=����������!��C��������������"��=�����������)&��Mumbai and SPM Hoshangabad, the excess Assets found which were
stated to be acquired at the time of takeover have been valued at Nominal
Value of ` 1 only.
iii. The Title Deeds of the Immovable Properties taken over are yet to be
���!������ ��� ��� %*�� �!� ��� ��*"���� +��� �<�'��� ��� ������ �!�Stamp Papers etc estimated at ` 500 crores may accrue to the company
in future.
�=�� +����"���$���'������������!�''�����(�����"�������'����������
v. The ERP (SAP) System has been implemented and handed over at all
units except ISP Nashik, BNP Devas, CNP Nashik & SPP Hyderabad.
However till date the same is stated to be at stabilization stage and
accordingly. The hardware comprising of computer terminals only have
been capitalized as computers. Remaining expenses are shown as work
in progress and other incidental expenses including internet connectivity
etc and other in house expense have been charged off to the revenue
expenditure.
g. ����� �� ������� ! ��� ������ �������� �� � ��� ������ ! � )��� #��I������
i. Provision for arrears for anomaly in VI Pay Commission has been made
on adhoc basis (Noida)
h. �������������� !��� ���������������� ���� ������! �+�����
��� +��� ��������������������?V���'��<��)&��%�������'��(���*�'�����!�99 years w.e.f. 3rd May, 1985 & 90 years w.e.f. 12th May, 1993 respectively
from Noida Authority has been amortized over the remaining period of
lease starting from 10-02-2006, instead from the date of commencement
�!� '�����S������ ��� ����"��*��*�"����� ���AKA?K?AA]�������<����adjusted from the “Fund from Government of India (Adjustable) Account.”
i. �������������� !��� ��������������<O ���� ������! ����������� !Assets
��� +�$����S�C����������=��<�����������������*"������=�����������in all the units except for SPM Hoshangabad & that IGM Hyderabad has
discontinued operations at Saifabad Unit w.e.f. 01-11-2009. However, the
��������������*"��*����!����S�C���������������������''�"�����(�
j. ����� �� ������� ! ��� ������ �������� <� � ��� ������ ! � '� "��� ��� �����������$�������Q� ��������������R
��� ��'����<���(�!�''�;���;����������*"���!���"��=�������(��!� �����=�����taxes etc. in respect of immovable properties acquired are not identical.
73
)�����<�������!���!���������'�����Q���*��!�'�<�'������'�����<��determined.
ii. In case of Unit at ISP Nashik, the management is following the practice
of not charging Value Added Tax or Central Sales Tax on transactions of
sales. The practice followed is in contravention to the provision of MVAT/
CST Act. Further the company is showing VAT/Sales Tax Receivable &
MVAT Refund Receivable separately under current assets for the purpose
�!��'�*��(�)�"��U�+�������(�������#�"��U�+� �<�'���;�����""������ <�� ������������ �('� �"������ �<����� <�� ��� ��*"��� ��� '��������*������'�<�'����)�������"���������������"���<�������*"���is a deviation from the provisions of Accounting Standard 29.
iii. Only IGM Noida, has created a provision of ` 45.02 lacs on account of
arrears for anomaly in VI Pay commission that too on adhoc basis. Similarly
provision for compensation in lieu of compassionate appointment of
` 20 lacs in case of SPP Hyderabed, ` 5 lacs in IGM Noida, ` 10 lacs in
BNP Devas have been made on ad hoc basis. Further IGM Kolkata has
made an adhoc provision of ` RA�'����;����������*"'�����<�������Security Expenses payable at IGM Noida of ` 3.50 lacs has been made
on adhoc basis instead of provision to be made on actual basis.
�=�� E��"���������"�����(������'�*����!���'��������\���"����<��the company have been disclosed as contingent liability.
In our opinion the Financial Position of the company should be analyzed considering
the provisions of Accounting Standards as mentioned above
J. That, further to our comments in the Annexure in Paragraph “C” above, attention is
invited to the facts stated in the following paragraph:
1. That, a sum of ` 98.10 crores was credited on account of debit advise sent to
Ministry of Finance on 31st March, 2011 on account of rate difference in the
selling price of minted coins. Similarly a sum of ` 121.45 crores was credited
��������� �!� ��<�� �=���� ���� ��I�D�)�� !��� ��� �����'� ���� ?A��K�?����account of rate difference in selling price of currency notes. However both the
advices have not yet been accepted by them.
2. That, advances include a sum of ` 58.23 lacs, made for supply of spares
since Financial Year 2006 onwards, which have not been settled as yet. The
company has stated having initiated settlement process with the vendors and
the spares already received but not accounted for shall be accounted for in
subsequent year.
3. That, the Company does not have any policy of taking Transit Insurance or
the insurance for Assets owned by the Company. The company is contingently
liable to contingencies.
4. That, the balance appearing under the head Sundry Debtors, Sundry Creditors,
���� ��� ��=����� ��� ��<J��� �� �����*���\�������'������ !��*� ���respective parties.
74
K. The Department of Company Affairs vide GSR 829(E) dated 21.10.2003 has
�'������ �� �'���� �(�� �!� ��<� ������� ���� �!� �������� ?WO� �!� ��� ��*"�����Act, 1956 shall not apply to a government company.
�� )L���� ! � ���� ������� ������ �$ "�, in our opinion and to the best of our
information and according to the explanations given to us the said accounts read
together with the accounting policies and notes thereon give the information
required by the Companies Act, 1956 in the manner so required and give a true
and fair view in conformity with accounting principles generally accepted in India :-
1. In the case of Balance Sheet of the state of affairs of the company as at
31st March, 2012, and
?�� )����������!���*����!��������� ������������!���������!����������ended on that date,
V�� )����������!�����S'�;���*����!��������P�;�!���������������������date.
For Serva Associates
Chartered Accountants
Firm Reg. No. 000272N
Sd/-
(C.A. Amarjit Verma)
Partner Place: New Delhi
M. No. 083520 Date: 30.07.2012
75
ANNEXURE TO THE AUDITORS REPORT
Referred to in paragraph “C” of our report of even date.
)�� �� S�''� "����'��� ���'����(� Q����=�� ���'�� ��� ������� �!� �C��� �����acquired as on 10.02.2006 have not been maintained properly and that the
Fixed Assets purchased/acquired subsequently have generally been recorded
<��������������!�����*��������<������������*�������
� <�� +����C���������=����'��<����"�����''��=�����������������'����?�M�����*�'��)���%�����������T����<����������'�U���������;��'��������at IGM Kolkota & IGM Mumbai but was not reconciled with the books of
��������������'�U�����������������!�����T����(<��;�������<����external agency but we have been informed that the report submitted by them
was not found to be satisfactory & hence not accepted by the management.
T����� ��������"�����$� �� ��''� <�����*��� �����"�����'� =���������;��������������������%��������'�U���������;����������������!�������������������������;������=��<����"�����''��=�������<�����*�(�*���during the year no material discrepancies were stated to be noticed on such
=���������
c. During the year IGM Kolkota has disposed/discarded plant & equipment
having gross cost of ` 19.90 crores and charged ` ���W?���������� �������Sales/discarding of Fixed Assets.
))�� �� +��� )�=������ ��� <���� "�����''�� =������� <�� ��� *�(�*��� � ��(�'��intervals, except incase of IGM Mumbai, for gold lying with Reserve Bank of
India, the possession of which have not been given to the company & with
regard to Commemorative Coins & Metals lying in case of IGM Kolkota .
� <�� +���"����������!�"�����'�=����������!���=������!�''�;���<�����*�(�*���is not adequate considering the size of the company and the nature of its
<���������+����������������!��*'�G�����"��������!�"�����'�=������������respect of all items of inventory including Stores & packing Materials.
c. On the basis of our examination of the record of inventory, we are of the
opinion that company is not maintaining proper records of inventory in some
�!����������E�����"����������������=���������<�;�������"�����'�������and books records in case of IGM Hyderabad & SPM Hoshangabad were not
�������'��\���������E����(����"�����'�=����������)&��%��$��?�WW�'���coins were found short. There is a need to strengthen the inventory valuation
methods and procedures. Further the budgeted cost needs to be periodically
reviewed and updated as per actual.
76
III. As per information and explanation given to us and audit procedures carried out
by us, the company has neither granted nor taken any loans to/from companies or
other parties to be covered in the register to be maintained under Section 301 of
the Companies Act, 1956.
IV. In our opinion and according to information & explanation given to us, the internal
control system is not commensurate with the size of the company and the nature of
its business w.r.t. reconciliation of Debtors, Creditors and Advances, cash in hand,
�!!� �=���� ��'�*��� ���'����(� )������ ������$� ����������� ��� ='�����of in house developed Dies, Material & Fixed Assets procurement & spares
replacement procedures, guidelines with regard to perquisites and business
promotion expenses etc.
V. a. Based on the Audit procedure applied by us and according to Information
& Explanation provided by the management, we are of the opinion that the
company have not entered into any contract or arrangement referred to in
section 301 of the Companies Act, 1956.
b. The clause is not applicable in view of point V(a) above.
VI. In our opinion and according to the information and explanation given to us, the
Company has not accepted any deposit from public during the period and hence
the directive issued by the Reserve Bank of India and provisions of Section 58A,
58AA or any other relevant provisions of the Companies Act, 1956 and the rules
framed there under are not applicable.
VII. Although, the company has the system of Internal Audit by external agencies at
all the units, yet the same is not commensurate with the nature and size of the
business. There is a need to ensure timely submission of reports & to streamline
the follow-up procedures to all the objections raised during the internal audits.
VIII. That the company has not maintained the cost record at any of the units as required
under Cost Accounting Record Rules by the Central Government u/s 209(1) (b) of
the Companies Act, 1956.
IX. a. According to the records of the company and the information & explanations
given to us, the company is regular in depositing with the appropriate Authority
undisputed Statutory dues including Provident Fund, Employee State
Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty,
Excise Duty, Cess and other Statutory dues applicable to it with appropriate
Authorities except the under mentioned:
77
Sl.
No.
Nature of Statute Nature of Dues Unit Name O/s Amount
(`)
Period to
which it
relates
1 For Employees on
Deputation
�=���'���Contribution
& Pensionery
Charges
IGM Naoda 14,560,340 1.10.2008 to
31.03.2011
2 Scrap, Tender
Forms & Canteen
Sales
Value Added Tax ISP Nashik 3,688,444 01.02.2006
to
31.03.2012
3 For Employees on
Deputation
Pensionery
Charges
SPM
Hoshangabad
117,242,161 01.10.2008
to 31.03.2011
4 For Employees on
Deputation
Pensionery
Charges
SPM
Hoshangabad
981,947 01.10.2008
to 31.03.2011
x��+���"�*��������!����<�=�������;�����=�'<'��!���=��������
b. According to the records of the company and information & explanation given
to us, the particulars of dues of Sales Tax, Income Tax, Wealth Tax, Service
Tax, Custom Duty, Commercial Tax, Excise Duty & Cess as at 31.03.2012
which have not been deposited on account of dispute are as follows:-
S.
No.
Nature of
Liability
Unit Name Assessment
Year
Amount in
Dispute
(`)
Authority
with whom
the Dispute is
Pending
1 Sales Tax ISP Nashik 2,106,978,903
2 Sales Tax/Entry
Tax/Commercial
Tax
BNP Devas 2006-07
2007-08
96,053,345 High Court of
MP
3 Sales Tax IGM Hyderebad NA 807,201,016
4 Sales Tax SPM
Hoshangabad
2009-10 33,246,523
5 Octroi Penalty CNP Nashik 2,38,79,51,690
6 Income Tax
Penalty
Corporate
#!���2006-07 5,712,718 CIT (Appeals)
7 Central Sales
Tax
IGM Mumbai 2004-05 624,349 Jt. Comm of
Sales Tax
Appls)
8 Central Sales
Tax
IGM Mumbai 2003-04 767,430 Jt. Comm of
Sales Tax
(Appls)
78
S.
No.
Nature of
Liability
Unit Name Assessment
Year
Amount in
Dispute
(`)
Authority
with whom
the Dispute is
Pending
9 Central Sales
Tax
IGM Mumbai 2002-03 423,435 Maharashtra
Sales Tax
Tribunal
10 Bombay Sales
Tax
IGM Mumbai 2004-05 216,543 Jt. Comm of
Sales Tax
(Appls)
11 Bombay Sales
Tax
IGM Mumbai 2003-04 420,824 Jt. Comm of
Sales Tax
(Appls)
12 Tax Deducted at
Source
IGM Noida 2007-08 19,000 ACIT
13 Tax Deducted at
Source
IGM Noida 2008-09 96,000 ACIT
14 Tax Deducted at
Source
IGM Noida 2009-10 484,000 ACIT
15 Service Tax SPM
Hoshangabad
178,499 Assistant
Commissioner
of Central
Excise
X. The company has no accumulated losses and has not incurred cash losses during
��������'�������=�����<�� ���������� ��� �**����'��"�������(������'�year.
XI. Based on our audit procedures and on the basis of information & explanations given
by the management, we are of the opinion that the Company has not defaulted in
��"�*����!����������������'�������������<����+�������������<����������the company.
XII. In our opinion and on the basis of information & explanations given by the
management, the company has not granted loan or advances on the basis of
security by way of pledge of shares, debentures and other securities.
XIII. In our opinion and on the basis of information and explanations given by the
management, the company is not chit fund/nidhi/mutual fund/society to which the
provisions of special statute relating to chit fund are applicable.
XIV. In our opinion the company is not dealing in or trading in shares/securities,
debentures and other investment. Accordingly the provision of clause (xiv) of the
companies (Auditors Report) order, 2003 are not applicable to the company.
XV. As explained by the management of the company. The company has not given
(������!���'��������<�������!��*�<������������'�����������
79
XVI. According to information and explanations given to us and records of the company
examined by us the company has not taken any term loan.
XVII. According to information and explanations given to us and on an overall examination
of the Balance Sheet of the company, we report that during the year short term
fund have not been used for long term investment.
XVIII. The company has not made any preferential allotment of share during the year.
XIX. The company has not issued any debentures during the year.
XX. The company has not raised money by way of public issue during the year.
XXI. Based upon the audit procedures performed and information and explanations
given by the management, we report that no fraud on or by the company has been
noticed or reported during the course of our audit for the year ending 31st March,
2012.
For Serva Associates
Chartered Accountants
Firm Reg. No. 000272N
Sd/-
(C.A. Amarjit Verma)
Partner Place: New Delhi
M. No. 083520 Date: 30.07.2012
80
SECURITY PRINTING AND MINTING CORPORATION OF INDIA LTD.
Balance Sheet as at 31.03.2012 Amount in `
Sl.
No.
Particulars Note
No.
Figures as
at the end of
31.03.2012
Figures as
at the end of
31.03.2011
I. EQUITY AND LIABILITIES
1 Shareholders’ funds
(a) Share capital Note 2 500,000 500,000
(b) Reserves and surplus Note 6 23,703,374,095 19,232,627,510
2 Funds from Govt. of India (Adjustable) Note 3 28,796,699,343 28,797,821,109
3 Non-current liabilities
(a) #���� ��(���*�'�<�'����� Note 7 252,977,697 242,060,604
(b) ��(K��*�"��=������ Note 8 2,620,749,161 2,553,037,399
4 Current liabilities
(a) Trade payables Note 9 1,917,763,361 1,111,996,726
(b) Other current liabilities Note 10 2,240,672,938 4,365,619,542
(c) Short-term provisions Note 11 10,468,371,179 9,422,081,373
TOTAL 70,001,107,774 65,725,744,263
II. ASSETS
1 Non-current assets
(a) Fixed assets Note 12
(i) Tangible Assets 9,008,651,075 8,944,220,291
(ii) Intangible Assets 15,514,573 8,389,933
(iii) Capital Work in Progress 1,660,199,427 2,309,826,419
(b) Non-current investments Note 13 1,000,000,000 500,000
(c) Deferred tax assets (net) Note 53 733,939,055 934,660,212
(d) ��(K��*�'��������=���� Note 14 2,382,304,092 2,159,343,025
(e) Other non-current assets Note 15 1,990,768,353 1,788,589,783
2 Current assets
(a) Current investments Note 16 1,001,034,915 1,017,822,186
(b) Inventories Note 17 9,798,393,827 9,555,548,425
(c) Trade receivables Note 18 12,658,716,701 9,610,107,957
(d) Cash and Bank Balances Note 19 17,905,615,101 18,757,818,441
(e) Short-term loans and advances Note 20 11,199,305,564 10,246,166,521
(f) Other current assets Note 21 646,665,091 392,751,070
TOTAL 70,001,107,774 65,725,744,263
��(��������������(���'������ � ���������������� Note 1
Notes 1 to 89 referred to above form an integral part of the Financial Statements.
As per our report of even date annexed.
For M/s SERVA ASSOCIATES On behalf of Security Printing and Minting
CHARTERED ACCOUNTANTS Corporation of India Ltd.
Firm Registration No. 000272N
Sd/- Sd/- Sd/-
CA. AMARJIT VERMA M.S. Rana Ashwini Kumar
(M.No 083520) Chairman & Managing Director Director (Technical)
Partner & Incharge Director (Finance)
Sd/-
Date: 30.07.2012 Sachin Agarwal
Place: New Delhi (Asstt Company Secretary)
81
SECURITY PRINTING AND MINTING CORPORATION OF INDIA LTD.*�����������������������������#�������������2-�32��3-�
Amount in `Sl.No.
Particulars NoteNo.
Figures for the Year ending on
31.03.12
Figures for the Year ending on
31.03.11I. Revenue from operations Note 22 34,948,022,205 32,285,981,895II. Other income Note 23 1,676,507,133 2,282,927,475III. Total Revenue (I + II) 36,624,529,338 34,568,909,370IV. Expenses:
Manufacturing Cost Note 24 17,595,990,043 15,971,737,656���(��������=���������!���������(����$�work-in-progress
Note 25 (201,183,054) (110,161,609)
F*"'�����<�������C"���� Note 26 7,620,964,891 7,327,370,009Finance costsDepreciation and amortization expense Note 12 986,355,428 1,001,894,701Impairment of Assets Note 12 114,172,312Other expenses Note 27 1,606,771,404 1,354,620,929Provisions Note 28 157,680,159 620,234,949Total expenses 27,880,751,183 26,165,696,635
V. ������������������������4 �+�������and extraordinary items and tax (III-IV)
8,743,778,154 8,403,212,735
VI. Prior Period Income / (Expenses) Note 29 4,946,793 (233,796,750)VII. ������������4 �+�����������
extraordinary items and tax (V-VI)8,748,724,947 8,169,415,985
VIII. Exceptional Items 0 0IX. ������������4������������������������4�
(VII - VIII)8,748,724,947 8,169,415,985
X. Extraordinary Items 0 0XI. �������������4�&�565' 8,748,724,947 8,169,415,985XII. Tax expense:
(1) Current tax (2,686,476,050) (2,670,383,980)(2) Deferred tax (200,721,157) 235,911,625(3) Taxes of Earlier Years (36,868,159) 36,979,905
XIII. ����7&����'�����#��+����������continuing operations (XI-XII)
5,824,659,581 5,771,923,535
XIV. ����\�'�����!��*������������(��"������ 0 0XV. Tax expense of discontinuing operations 0 0XVI. ����7&����'�����,�� ����������
operations (after tax) (XIV-XV)0 0
XVII. ����7&����'�����#��+������&5����8�5%�' 5,824,659,581 5,771,923,535XVIII. Earnings per equity share:
(1) Basic Note 52 116,493 115,438(2) Diluted 116,493 115,438
��(��������������(���'������ � ���������������� Note 1
Notes 1 to 89 referred to above form an integral part of the Financial Statements.
As per our report of even date annexed.
For M/s SERVA ASSOCIATES On behalf of Security Printing and MintingCHARTERED ACCOUNTANTS Corporation of India Ltd.Firm Registration No. 000272N
Sd/- Sd/- Sd/-CA. AMARJIT VERMA M.S. Rana Ashwini Kumar(M.No 083520) Chairman & Managing Director Director (Technical)Partner & Incharge Director (Finance)
Sd/-Date: 30.07.2012 Sachin AgarwalPlace: New Delhi (Asstt Company Secretary)
82
SECURITY PRINTING AND MINTING CORPORATION OF INDIA LIMITED
(WHOLLY OWNED BY GOVT. OF INDIA)
CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2012
31st March 2012
Amount in `31st March 2011
Amount in `
A. CASH FLOW FROM OPERATING ACTIVITIES
�������������4����� 8,748,724,947 8,169,415,988
Adjustment for:
Depreciation (Net) 986,355,428 999,189,089
Provision/Adjustment for Impairment of Assets 114,172,312 23,759,685
Provision for Bad Debts 153,390,840 192,707,236
Provision for Obsolete Inventory 4,289,319 1,234,973
��������'���!������ 117,593,312 -
���������'���!������ (516,993) (324,057)
Provisions Written Back (245,334,954) (496,832,145)
Interest Income (1,230,841,434) (1,215,230,045)
Income from Bond Fund - (2,750,421)
Dividend Income (63,212,729) (43,179,170)
1��#� 9�.� ���� �+�������� � ��������� ������ .��"����capital adjustments
8,584,620,048 7,627,991,133
Change in Current/Non Current Assets & Liabilities
(Except Fixed assets & Investment)
Change in Current Investment 16,787,271 (25,929,591)
Change in Inventories (302,407,804) (1,959,955,645)
Change in Trade Receivables (3,201,999,584) (349,853,344)
���(����������+��*� ���������=���� (953,139,043) 56,302,908
Change in Other Current Assets (253,914,020) (691,042,201)
Change in Trade Payables 805,766,636 -
���(�����#����������� �<�'���� (374,946,604) 178,723,480
���(����� ��(�+��*����=������ 73,693,646 -
Change in Short Term Provisions Employees 569,134,114 -
Change in Other Short Term Provision (1,121,328) (997,852,725)
1��#�9�.������+��������� �����������������4�� 4,962,473,332 3,838,384,015
Income Taxes Paid (2,013,499,108) (2,949,396,139)
NET CASH FROM OPERATING ACTIVITIES (A) 2,948,974,224 888,987,876
B. CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Fixed Assets (419,971,155) (1,129,057,966)
83
31st March 2012
Amount in `31st March 2011
Amount in `
Increase in Capital WIP (753,008,866) (1,343,205,682)
Sale of Fixed Assets 83,672,393 716,692
Increase in Investment (999,500,000) (500,000)
Dividend Income 63,212,729 43,179,170
Income from Bond Fund - 2,750,421
adjustment in Fixed Assets 449,775,139 -
Interest Income 1,230,841,434 1,159,956,007
)���������� ��(�+��*� ���������=���� (222,961,067) -
Increase in Other Non - Current Assets (146,905,486) -
Funds from Govt of India (1,121,767) -
)����������#���� ��(�+��*� �<�'���� 10,917,093 -
NET CASH FROM INVESTING ACTIVITIES (B) (705,049,554) (1,266,161,358)
C. CASH FLOWS FROM FINANCING ACTIVITIES
Payment of Dividend (1,154,384,708) -
Payment of Dividend Distribution Tax (191,743,300) -
I�"�*����!� ��������������!�S����� (1,750,000,000) (1,750,000,000)
NET CASH USED IN FINANCING ACTIVITIES (C) (3,096,128,008) (1,750,000,000)
NET INCREASE/(DECREASE) IN CASH AND CASH
EQUIVALENTS (A+B+C)
(852,203,339) (2,127,173,482)
Cash & Cash Equivalents at the beginning of the year 18,757,818,440 20,884,991,922
Cash & Cash Equivalents at the end of the year 17,905,615,101 18,757,818,440
Note: Cash and Cash Equivalent includes FDR Pledged with bank of Rs. 3,30,00,000/-
For M/s SERVA ASSOCIATES On behalf of Security Printing and Minting
CHARTERED ACCOUNTANTS Corporation of India Ltd.
Firm Registration No. 000272N
Sd/- Sd/- Sd/-
CA. AMARJIT VERMA M.S. Rana Ashwini Kumar
(M.No 083520) Chairman & Managing Director Director (Technical)
Partner & Incharge Director (Finance)
Sd/-
Date: 30.07.2012 Sachin Agarwal
Place: New Delhi (Asstt Company Secretary)
84
:���(�-�*����� ����$ ����������� ���
(i) Basis of preparation
� +��������'���*�������"��"��������������������'��������=������������accrual basis of accounting, in accordance with the Indian Generally Accepted
Accounting Principles (GAAP) and comply with the accounting standards as
prescribed by the Companies (Accounting Standards) Rules 2006, to the extent
""'��<'�� �� ��"��� ��������'�� <�� ��� ��*"���� +��� �����'� ��*����have been prepared in Indian rupees. Forgery Detection Charges Recoveries from
employees for use of amenities insurance and railway claims tax and duties and
last pay of employees are accounted for on cash basis.
(ii) Use of estimates
� +���"��"������!������'���*����������!��*���;������)�����&������Q������management to make estimates and assumptions that affect the reported amounts
�!���������'�<�'���������'�������!������(���'�<�'�������������!���������'�statements and the reported amounts of revenues and expenses during the reporting
period. Examples of such estimates include provision for future obligations under
�*"'�����<�����"'��$�"��=�������!������<!�'�����=�����$����*������!�''�'�!���!��C���������������'�����'�����'����!!���!��*���������*�����������(��������accounting estimates is adjusted prospectively in the current and future periods.
(iii) Revenue recognition
Revenue is recognized on dispatch of goods to the customer. Gross sales are
stated inclusive of excise.
Job work income is recognized at the time of completion of task as per terms agreed.
Interest on the deployment of surplus funds is recognized using the time-proportion
method based on interest rates contracted in the transaction.
Dividend Income is recognized in the year of receipt by the company
(iv) Fixed assets
Fixed assets acquired (post acquisition*) have been stated at cost less accumulated
depreciation. Cost is inclusive of freight, non recoverable duties, taxes and other
directly attributeable cost or bringing the assets to the working condition for intended
use.
Fixed assets under construction are disclosed separately as capital work in progress.
� �����'������������������*�����!�'����"��*��*�"��������*���!�(����!� ���$�'����*����*���G���
* For Assets acquired from Government of India (Vendor), the same have been disclosed at the Gross Cost
as appearing in the Books of the Vendor less Accumulated Depreciation up to the date of transfer as against
the Cost of Acquisition of such assets.
85
� E���\���'������!�''�����(������������� ������������)���������=�'�"��������are not separately valued or accounted for in the books of accounts. Used/Defaced
dies, being high security items are shown at nil value.
(v) Depreciation
� E�"������������C�����������"��=��������������(�K'����*����������������������*������"�������������������'��[)U��������*"�������$��NR]���applicable for Single and Double Shift Basis. Assets costing less than ` 5,000 per
unit are fully depreciated in the year of purchase.
(vi) Impairment
The carrying values of assets are reviewed at each reporting date to determine
if there is indication of any impairment. If any indication exists, the asset’s
recoverable amount is estimated. For assets that are not yet available for use
the recoverable amount is estimated at each reporting date. An impairment loss
is recognized whenever the carrying amount of all asset of its cash generating
unit exceeds its recoverable amount. Impairment losses are recognized in the
"�������'���������������*"��*���'���������=�������!���������<��������(��in the estimates used to determine the recoverable amount. An impairment loss
is reversed only to the extent that the assets carrying amount does not exceed
the carrying amount that would have been determined net of depreciation or
amortisation, if no impairment loss had been recognized.
(vii) Amortization
a. Amortization of Lease Assets
� ������'����(������*���G����=������"�������!� ����
b. Amortization of Expenditure on Computer Software
Computer Software Purchased, individual value of which is below ` 1 lac
are fully amortized in the year of Purchase and those exceeding ` 1 lac are
amortized over the useful life but subject to a maximum period of 3 years.
(viii) Inventories
Inventories are valued as per AS-2 issued by ICAI is followed which is as under:
Raw materials & components: valued at the lower of cost and net realizable value.
Work in Progress: Valued at Cost based on percentage of completion and Cost is
ascertained on FIFO/Weighted Average Cost Method except at SPM Hoshangabad
where it has been valued at budgeted cost.
Finished Goods: Valued at lower of Cost or net realizable value except at SPM
Hoshangabad where it has been valued at budgeted cost.
Inter Unit Inventory: Valued at budgeted cost.
86
Scrap: Valued at Net Realizable Value.
IGM, Kolkata - Commemorative coins and medals has been valued at 91% of the
last sales price: cost has not been ascertained in accordance with Accounting
Standard (AS-2).
(ix) Inter Unit Transfers and Valuation of such Inventory
The units are transferring ink, paper, blank and dies at budgeted cost. Other items
of consumables etc. are transferred at cost of purchase. Such items of inventory
���='�����<��(�������������������'���*����
(x) Operating leases
� ����"�*�������������"����(�'�����������(��G��������C"������������������� ������������������'�<����
(xi) Investments
Investments that are readily realizable and intended to be held for not more than
���������'���������������� ��=��*�����)�=��*�����������������������'���������'��(K��*���=��*�����)�=��*������'��"��*��'����"�����!��'������!�������C��������!�<���������������(���'����������<��'��������� ��(�+��*�Trading Investments and others as non trading investments. Current investments
are carried at lower of cost or fair value determined on an individual investments
<����� ��(K��*���=��*�����������������������=������!�����*����������='���is made to recognize a decline other than temporary in the value of the investments.
(xii) Foreign currency transactions
Foreign currency transactions are recorded at the exchange rates prevailing on the
date of the respective transactions. Realised gains and losses on foreign currency
��������� �����(� ��� ���� ��� ����(��G��� ��� ��� ����� ��� ���� ��������Monetary foreign currency assets and liabilities remaining unsettled at the balance
sheet date are translated at year end rates and resultant gains/losses on foreign
�������������������������(��G����������������� �����������
Exchange gains or losses pertaining to acquisition or Capital Assets are capitalized
to the Cost or such assets.
(xiii) /����������������#�����+�������������
� ,������ ������������+����(�+�����*"��L��"��=�����!��������*������������������<�����"'�����������������<�����"'�� ����"��K�*"'��*���<�����"'��������;������������"����C��������<���������;�''��=������<'�(������"��!������ *������ #<'�(����� !��� �����<������ �� ������� �����<����� "'��� �������(��G��������*"'�����<������C"������������������� �����������;����they are due. Prepaid contributions are recognised as an asset to the extent that a
cash refund or a reduction in future payments is available.
87
� ,������ ������� +����(� +��� ��*"��L�� (����� ����*�� ��� � ������� <�����"'������������<�����"'�� ����"��K�*"'��*���<�����"'���+�����*"��L������<'�(���� ������"����!��������<�����"'��� ����'��'���<�����*��(� ���*�����!�!�����<��������*"'������=�����������������!�����������=����������current and prior periods. As per the order of the GOI transferring the Assets and
�<�'������!�M����������) �*����!�����*"'�������!���������;�������!���������deemed deputation for a period of 2 years from the date of transfer i.e. 10/02/2006
;�����;��!�������C������!����������?�*�����������������;���������<��the Government to get absorbed in the company. Options were exercised and
Government accepted absorption of employees in the company on 29th May 2009
but w.e.f. 01/11/2008.
Those employees who decided to remain with Government continue to work in
the company till they are redeployed by Government. Company has to bear their
salary and wages. The provisions for pensionary charges (which includes Gratuity)
��� �=���'��������<�����������"����!�������*"'���������!����������'���(�ex-cadre/in-cadre posts have been made in accordance with the Government Rules.
Those employees who decided to join the company had two options. They have
opted either for “Combined Pension” or “Pro-rata Pension”. Combined pension
optees are eligible to get their pension a Pension Trust constituted by Government
at the time of their superannuation from company. Government shall contribute
for the past services rendered and company shall contribute for the period they
will serve the company. Manner and amount of contribution shall be governed
by rule 37-A of CCS (Pension) Rules. Provision for pensionary charges of these
employees has been made accordingly. This provisions includes Gratuity also.
;�#���<����������������( As per the Company’s policy eligible leaves can be
accumulated by the employees and carried forward to future periods to either be
utilized during the service, or en-cashed. Encashment can be made during the
service, on early retirement, on withdrawal of scheme, at resignation by employee
����"��������!��*"'������+�����'���!�<������ �������*�����<����������seniority and the respective employee’s salary.
(xiv) Prior Period & Extra Ordinary Items
Prior Period Items are incomes and expenses which arise in the current period as
a result of errors and omissions in the preparation of Financial Statements of one
or more prior periods.
Extra Ordinary Items are incomes and expenses that arise from events or
transactions that are clearly distinct from the ordinary activities of the enterprise
and therefore not expected to recur frequently or regularly.
� D��������������������C������������*�������"��'������'����������������'�statements.
88
(xv) Research & Development
Capital Expenditure pertaining to Research and development are Capitalized as
S�C�������������������=�������������������(�����"�������'����������
(xvi) Earnings per Share
Basic earning per share is computed using the weighted average number of equity
shares outstanding during the year. Diluted earning per share is computed using
the weighted average number of equity and dilutive equity equivalent shares
outstanding during the year end, except where the results would be anti-dilutive.
(xvii) Taxation
������������!�������L
Income tax expense comprises current tax (i.e. amount of tax for the period
determined in accordance with the income tax law) and deferred tax charge or
������ ���P����(� ��� C��!!����!� �*��(���!!��������<�;�����������(� ����*��and taxable income for the period). The deferred tax charge or credit and the
corresponding deferred tax liabilities or assets are recognised using the tax rates
that have been enacted or substantively enacted by the balance sheet date.
Deferred tax assets are recognised only to the extent there is reasonable certainty
that the assets can be realised in the future. Deferred tax assets are reviewed
�����<'���������������;�������;�����;������"�����P������*����that is reasonably/virtually certain (as the case may be) to be realised. Deferred
tax assets or liabilities arising due to timing differences, originating during the tax
holiday period and reversing after the tax holiday period are recognized in the
period in which the timing difference originates.
(xviii) Provisions and Contingent Liabilities
� �� "��=������ �����(� !��*� �'�*�$� '��(���$� �����*��$� ����$� "��'���$� ���� ���recognised when the Company has a present obligation as a result of a past event
��������"��<<'��������P�;��!������������*<�����(������*���<������;�''�<��required to settle the obligation and a reliable estimate can be made of the amount
of the obligation. These are reviewed at each balance sheet date and adjusted
�� ��P����������*�(�*������*���� ������(��� '�<�'������������'����� ���respect of possible obligations that have risen from past events and the existence
�!�;�����;�''� <�������*�����'��<�� ��������������������K������������!��������more uncertain future events not wholly within the control of the enterprise , or is
a present obligation that arises from past events but is not recognized because
��������������"��<<'��������P�;��!������������*<�����(������*���<������will be required to settle the obligation, or a reliable estimate of the amount of
the obligation cannot be made. When there is a possible obligation or present
�<'�(����;��������'���'�������!�����P�;������*��$��������'���������"��=������is made.
89
(xix) Provision for Doubtful Debts:
100 % Provision is created for Debts outstanding for a period more than 3 Years.
(xx) Operating Cycle
#"����(����'������������������*��<�;�����Q���������!������!���"��������(�and their realization in cash and cash equivalents. Where the normal operating
���'�������<����������$���������*������=����������!��?�������
In case of BNP and CNP - Normal operating cycle is 8 Months.
In case of Mints - Normal operating cycle is 8 Months for circulation coins and 12
months for other products of mints.
In case of Paper Mill - Normal operating cycle is 4 Months.
In case of Security Presses - As there is no certainty regarding realization of
Debtors in case of Products of these units as most of the customers are Government
��(��G���$����*'��"����(����'�������<����������$�+����!������������*������"����(����'����������!�"��������!������������!�����) �����?������
&44�'� 1������ ���������+���/�������* #������%����1��+������$ ��
As per Revised Schedule VI:
���� ���������''�<���'����������������;�����������������!����!�''�;��(�criteria:
1. It is expected to be realized in, or is intended for sale or consumption in,
the company’s normal operating cycle
2. It is held primarily for the purpose of being traded
3. It is expected to be realized within twelve months after the reporting date
4. It is cash or cash equivalent unless it is restricted from being exchanged
or used to settle a liability for at least 12 months after the reporting date.
� �''�������������''�<���'��������������������
�?�� ��� �<�'�����''�<���'����������������;�����������������!����!�''�;��(�criteria:
1. It is expected to be settled in the company’s normal operating cycle
2. It is held primarily for the purpose of being traded
3. It is due to be settled within twelve months after the reporting date
4. The company does not have an unconditional right to defer settlement
of the liability for at least 12 months after the reporting date. Terms of a
liability that could, at the option of the counterparty, result in its settlement
<������������!��Q���������*����������!!�������'���������
� � �''������ �<�'�������''�<���'��������������������
90
B. Raw Materials, stores and components, scrap which are intended for
consumption or sale in the course of the company’s operating cycle shall
<���'����������������
� ��� %��K*�=��(� ��=������ ��''� <�� �'������� �� %��K������� ��'���� �� ���estimated that the same shall be consumed or sold within 12 months
after the reporting date.
� E�� H�)�����''�<���'������������������'��
E. Finished Goods inventory which is being held primarily for purpose of
<���(� �������''�<���'�����������������+�����*��<����'�� !������period of time. That time period has no relevance here so far as it is held
primarily for trade.
F. Trade receivables which are expected to be realized within 12 months
!��*������"����(������''�<���'����������������
G. Trade receivables which are outstanding for more than 1 years as on
31.03.2012 shall be shown as Non Current only unless efforts for its
recovery have been made and it is likely that payment shall be received
within 12 months from the reporting date. A Judicious decision shall be
taken be unit in this regard. For Example: In case payment is pending due
��������'�G�����!�"�����������������(���������'���'���������(���''�<����'�G������"�*�����''�<����'�G���;����������������*����''�be treated as current.
Note 2
Share Capital As at 31st March 2012 As at 31st March 2011
Number Amount (`) Number Amount (`)
Authorised
Equity Shares of
` 10 each 2,500,000,000 25,000,000,000 2,500,000,000 25,000,000,000
Issued, Subscribed
and Paid Up
Equity Shares of
` 10 each 50,000 500,000 50,000 500,000
Total 50,000 500,000 50,000 500,000
Note 3
Funds from Govt of India (Adjustable) As at 31st March 2012
(`)
As at 31st March 2011
(`)
Opening Balance of Funds from GOI 28,797,821,109 28,798,539,115
Adjustments during the Year (if any) (1,121,767) (718,006)
Total 28,796,699,343 28,797,821,109
91
Note 4
Reconciliation of number of shares
outstanding at the beginning and at the
end of the year
As at 31st March 2012 As at 31st March 2011
Number Amount (`) Number Amount (`)
Shares outstanding at the beginning of the
year
50,000 500,000 50,000 500,000
Shares Issued during the year – – – –
Shares bought back during the year – – – –
Shares outstanding at the end of the year 50,000 500,000 50,000 500,000
Note 5
Name of Shareholder
holding more than 5%
shares
As at 31st March 2012 As at 31st March 2011
No. of
Shares held
% of Holding No. of
Shares held
% of Holding
President of India ��� ���Sh.Bimal Julka
49,994 99.99 49,994 99.99
Total 49,994 99.99 49,994 99.99
Note 6
Reserves & Surplus As at 31st March 2012
(`)
As at 31st March 2011
(`)
a. Capital Reserves
Opening Balance 41,994,800 41,994,800
(+) Current Year Transfer 0 0
(-) Written Back in Current Year 0 0
Closing Balance (a) 41,994,800 41,994,800
b. General Reserve
Opening Balance 577,192,354 0
(+) Current Year Transfer 582,465,958 577,192,354
(-) Written Back in Current Year 0 0
Closing Balance (b) 1,159,658,312 577,192,354
c. Surplus
Opening balance 18,613,440,356 14,764,837,175
�q��%������\�%�� �����!������Current Year
5,824,659,581 5,771,923,543
(-) Transfer to Reserves 582,465,958 577,192,354
(-) Proposed Dividends 1,164,931,916 1,154,384,708
(-) Dividend Distribution Tax 188,981,080 191,743,300
Closing Balance (c) 22,501,720,983 18,613,440,356
Total (a + b + c) 23,703,374,095 19,232,627,510
92
Note 7
Other Long Term Liabilities As at 31st March 2012
(`)
As at 31st March 2011
(`)
(a) Trade Payables-Non Current 16,726,091 5,808,998
(b) Retention against Sales Tax liability 202,228,399 202,228,399
(c) Taxes/Duties Payable 31,075,181 31,075,181
(d) Others-Non Current 2,948,026 2,948,026
Total 252,977,697 242,060,604
Note 8
Long Term Provisions As at 31st March 2012
(`)
As at 31st March 2011
(`)
��� ���=������!���F*"'�����D�����Provision for Gratuity 331,450,601 210,604,254
���=������!��� �=��F����*�� 1,626,507,013 1,717,081,215
Provision for Pensionary Charges
Contribution
433,381,083 395,860,642
���=������!��� �=���'��������<���� 229,410,464 229,491,288
Total 2,620,749,161 2,553,037,399
Note 9
Trade Payables As at 31st March 2012
(`)
As at 31st March 2011
(`)
Trade Payables other than MSMED 1,774,870,094 857,567,387
Trade Payables Principal - MSMED 142,893,268 254,429,339
Total 1,917,763,361 1,111,996,726
Note 10
Other Current Liabilities As at 31st March 2012
(`)
As at 31st March 2011
(`)
Current maturities of long-term debt- Working
�"�'� ���!��*���S0 1,750,000,000
Advances to Employees 488,164 802,838
Advance from Customers 443,010,521 511,238,593
Earnest Money Deposit (EMD) 26,573,702 21,315,587
Security Deposits of Supplier/Vendor 303,479,823 320,795,035
Payable to PAO 7,286,198 23,892,384
TDS Payable 18,667,724 15,472,367
Sales Tax Payable 11,508,808 13,198,966
Excise Duty Payable 1,133 30,676
Service Tax payable 451,306 899,614
93
Other Current Liabilities As at 31st March 2012
(`)
As at 31st March 2011
(`)
Octroi Payable 6,002,348 5,353,067
Salaries and Wages and other employees
<��������<'�464,222,604 525,521,278
Recovery from Salaries Payable to concerned
authorities
80,194,161 103,858,534
EPF/GPF Payable 157,749,941 157,849,703
Expenses Payable 170,802,295 168,815,543
�����<�����������) ���������+������<'� 17,000,141 12,702,021
Pensionary Charges Payable 332,332,205 319,536,163
Bank Book Overdraft 23,696,295 178,723,479
Capital Goods Creditors 66,988,852 68,550,995
#������������ �<�'���� 110,216,718 167,062,698
Total 2,240,672,938 4,365,619,542
Note 11
Short Term Provisions As at 31st March 2012
(`)
As at 31st March 2011
(`)
&�'� ������������=�+����������������=������!��� �=���'������Pensionary Charges
488,972,408 366,006,217
Provision for Gratuity 17,350,866 781,910
Provision for Ex-Gratia 5,744,839 5,988,023
Provision for leave encashment 204,620,050 21,120,764
���=������!�����*"���������� �����!�Compassionate Appointment
27,392,874 40,452,581
Provision for ACP Arrear Payable 5,132,234 31,000,000
Provision for VIth Pay Commission 4,502,000 4,312,058
#����F*"'������D�����������+��*�Provisions
52,896,418 7,169,092
(b) Other Short Term Provisions
Proposed Dividend 1,164,931,916 1,154,384,708
Dividend Distribution Tax 188,981,080 191,743,300
Provision for Taxation A.Y 2012-13 2,686,476,050 0
Provision for Taxation A.Y 2011-12 2,670,383,980 2,670,383,980
Provision for Taxation A.Y 2010-11 2,941,429,199 2,941,429,199
Provision for Taxation A.Y 2009-10 0 1,970,375,040
Provision for FBT 0 6,255,909
Other Short Term Provisions 9,557,264 10,678,592
Total 10,468,371,179 9,422,081,373
94
No
te 1
2 F
ixed
Assets
Sl.
No.
Part
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Bala
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Depre
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the
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)
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During the
Year
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``
``
``
``
``
``
``
`
1Tan
gib
le
Assets
��
47,5
69,7
28
00
4,1
21,9
09
43,4
47,8
19
00
00
00
00
47,5
69,7
28
43,4
47,8
19
��
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21,5
83,6
73
00
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21,5
83,6
73
1,4
25,8
98
277,5
76
00
1,7
03,4
74
00
0
20,1
57,7
75
19,8
80,1
99
Build
ings
965,2
52,3
15
9,5
15,7
48
212,0
96
(1,2
22,3
61)
975,7
78,3
28
331,7
19,9
95
20,0
11,2
99
(1,1
58,5
43)
212,0
90
352,6
77,7
47
00
0
633,5
32
,319
623,1
00,5
80
Facto
ry
Build
ing
1,1
92,6
18,1
02
31,5
54,8
32
0
(4,1
21,9
09)
1,2
28,2
94,8
43
526,6
36,4
02
37,5
84,9
29
42,8
27
0
564,1
78,5
04
00
0
665,9
81,7
00
664,1
16,3
39
Pla
nt and
Equip
ment
16,3
40,1
42,6
85
904,6
90,2
03
224,4
14,7
30
214,2
06
17,0
20,2
03,9
52
9,0
38,3
34,5
62
840,2
62,8
91
67,4
78,8
27
24,5
04,3
91
9,7
86,6
14,2
35
5,6
25,1
79
113,7
74,1
33
119,3
99,3
12
7,2
96,1
82,9
44
7,1
14,1
90,4
05
Furn
iture
and
Fix
ture
s
86,0
96,3
62
16,7
34,4
67
100,0
00
0
102,7
30,8
29
50,0
66,5
55
5,4
39,8
36
(381,0
22)
38,2
82
55,8
49,1
31
00
0
36,0
29,8
07
46,8
81,6
99
Vehic
les
83,6
99,6
90
3,1
62,6
38
0
(0)
86,8
62,3
28
57,9
03,4
23
5,1
16,7
53
(46,1
77)
0
63,0
66,3
52
00
0
25,7
96,2
68
23,7
95,9
76
#!�
���
Equip
ment
86,1
55,8
59
9,1
00,1
41
1,0
80,3
99
(115,1
51)
94,2
90,7
52
40,2
77,4
19
4,3
90,6
92
322,8
99
411,1
14
43,9
34,0
98
0
394,8
31
394,8
31
45,8
78,4
40
49,9
61,8
23
Com
pute
rs
and P
rinte
rs
139,9
88,0
86
74,3
59,0
37
116,4
39
0
214,2
30,6
84
91,5
25,0
98
26,0
24,8
13
52,3
02
31,4
70
117,4
66,1
39
0
3,3
48
3,3
48
48,4
62,9
87
96,7
61,1
97
Railw
ay
Sid
ing
4,6
82,8
17
00
0
4,6
82,8
17
2,1
66,4
86
159,9
91
00
2,3
26,4
77
00
0
2,5
16,3
31
2,3
56,3
40
Ele
ctr
ical
Insta
llations
398,1
28,3
33
68,0
25,0
94
0
1,2
22,3
61
464,9
31,0
67
281,5
33,9
63
12,2
62,2
51
1,2
21,6
79
0
292,5
74,5
35
00
0
116,5
94,3
71
172,3
56,5
32
R&
D A
ssets
5,5
26,3
55
22,8
19,4
17
00
28,3
45,7
72
8,7
34
893,8
03
00
902,5
37
00
0
5,5
17,6
21
27,4
43,2
35
Data
Centr
e
for
ER
P
0
112,5
07,8
99
00
112,5
07,8
99
0
18,2
37,5
30
00
18,2
37,5
30
00
00
94,2
70,3
69
Dis
aste
r
Recovry
Centr
e
0
35,9
09,4
92
00
35,9
09,4
92
0
5,8
20,9
29
00
5,8
20,9
29
00
00
30,0
88,5
63
To
tal
19,3
71,4
44,0
06
1,2
88,3
78,9
69
225,9
23,6
64
99,0
56
20,4
33,8
00,2
54
10,4
21,5
98,5
36
976,4
83,2
92
67,5
32,7
92
25,1
97,3
47
11,3
05,3
51
,689
5,6
25,1
79
114,1
72,3
12
119,7
97,4
91
8,9
44,2
20,2
91
9,0
08,6
51,0
75
Pre
vio
us
Year
18,3
48,2
16,9
79
1,1
17,8
50,9
84
(131,7
21)
94,7
55,6
77
19,3
71,4
44,0
06
9,4
99,8
54,4
03
995,5
56,6
65
73,8
12,5
34
(2)
10,4
21,5
98,5
36
5,6
25,1
79
0
5,6
25,1
79
8,8
42,7
37,3
96
8,9
44,2
20,2
91
2In
tan
gib
le
Assets
Com
pute
r
softw
are
19,3
28,0
74
16,9
83,3
09
635,8
78
0
35,6
75,5
05
17,5
79,2
92
6,5
52,0
59
35,8
62
613,4
83
23,4
82,0
06
00
0
1,7
48,7
83
12,1
93,5
00
R&
D A
ssets
(Softw
are
)
9,9
61,2
27
00
0
9,9
61,2
27
3,3
20,0
77
3,3
20,0
77
00
6,6
40,1
54
00
0
6,6
41,1
50
3,3
21,0
73
To
tal
29,2
89,3
01
16,9
83,3
09
635,8
78
0
45,6
36,7
32
20,8
99,3
69
9,8
72,1
36
35,8
62
613,4
83
30,1
22,1
60
00
0
8,3
89,9
33
15,5
14,5
73
Pre
vio
us
Year
18,2
35,2
57
11,2
55,6
75
(191,0
12)
10,6
19
29,2
89,3
01
14,1
27,6
83
6,3
38,0
36
433,6
49
0
20,8
99,3
68
00
0
4,1
07,5
74
8,3
89,9
33
3
Cap
ital W
ork
InP
rog
ress
2,3
09,8
26,4
19
753,0
08,8
66
885,3
91,1
22
517,2
44,7
37
1,6
60,1
99,4
27
00
00
00
00
2,3
09,8
26,4
19
1,6
60,1
99,4
27
To
tal
2,3
09,8
26,4
19
753,0
08,8
66
885,3
91,1
22
517,2
44,7
37
1,6
60,1
99,4
27
00
00
00
00
2,3
09,8
26,4
19
1,6
60,1
99,4
27
Pre
vio
us
Year
977,0
62,7
39
1,8
81,4
01,1
15
394,1
91,4
19
154,4
46,0
16
2,3
09,8
26,4
19
00
00
00
00
977,0
62,7
39
2,3
09,8
26,4
19
95
Note 13
Non-Current Investments
(Trade Investments)
As at 31st March 2012
(`)
As at 31st March 2011
(`)
Unquoted-Equity Shares of Bank Note
�"�����''� )�����=�� ��� ��U��!���������Printing and Minting Corporation of India
��� ��� D����� I����=�� D��� %��������� �=�� ��� z�$AA$AA$AAA� ������>�`��AA������S�X��AK��$�RAAA�������>�` 100 each)]
1,000,000,000 500,000
Total 1,000,000,000 500,000
Note 14
Long Term Loans and Advances As at 31st March 2012
(`)
As at 31st March 2011
(`)
a. Capital Advances
Secured, considered good 996,948,552 881,037,331
Unsecured, considered good 4,291,006 757,468
Unsecured, considered Doubtful 21,539 21,539
1,001,261,097 881,816,338
���Z����=������!������<!�'��=���� 21,539 21,539
Total A 1,001,239,558 881,794,799
b. Security Deposits
Unsecured, considered good 31,911,626 28,328,124
Total B 31,911,626 28,328,124
c. Employees loans and advances
Secured 116,179,952 132,704,084
Unsecured 160,402,559 94,824,401
Total C 276,582,511 227,528,485
d. Loans and Advances Others
Share Application Money Pending
allotment - Bank Note Paper Mill India Pvt.
�������������''�������VAKARK?A�?�
1,000,000,000 999,500,000
Unsecured 72,570,397 22,191,617
Total D 1,072,570,397 1,021,691,617
Total (A+B+C+D) 2,382,304,092 2,159,343,025
96
Note 15
Other Non-current Assets As at 31st March 2012
(`)
As at 31st March 2011
(`)
Long Term Trade Receivables
Unsecured, considered good 1,402,969 1,402,969
Doubtful 1,274,930,061 837,667,420
1,276,333,030 839,070,389
���Z����=������!������<!�'���<� 1,274,930,061 837,667,420
Total (A) 1,402,969 1,402,969
Non-moving Inventory 1,958,333,202 1,768,333,860
���Z����=������!�������*�=��(���=����� 51,123,024 49,284,232
Total (B) 1,907,210,178 1,719,049,628
Deposit with CISF 6,396,600 6,396,600
Deposit with Electricity Board 50,947,686 39,317,165
Deposit with Tax authorities/other
Departments
24,694,920 22,305,421
Advances (others) 116,000 118,000
Total (C) 82,155,206 68,137,186
Total (A+B+C) 1,990,768,353 1,788,589,783
Note 16
Current Investments (Non-Trade) As at 31st March 2012
(`)
As at 31st March 2011
(`)
UTI Liquid Cash Plan
(Short Tem, Valued at Cost)
�NWW�V��W?������>��A�N�OR\K�z�����U'������='�������������31.03.2012 ` 996,853,474]
996,853,474 –
UTI Treasury Advantages Fund
(Short Tem, Valued at Cost)
�O��A�RR������>�` 1,000.21/-)
z�����U'������='�������������31.03.2012 ` 4,181,441]
F.Y. 2010-11
��$A�W$]AO�V�������>�` 1,000.2141/-)
z�����U'������='�������������31.03.2011 ` 1,017,822,186]
4,181,441 1,017,822,186
Total 1,001,034,915 1,017,822,186
97
Note 17
Inventories As at 31st March 2012
(`)
As at 31st March 2011
(`)
Raw Materials and Components 4,196,712,652 4,601,138,366
Raw Material in Transit 1,069,522,624 445,088,479
Goods in Transit 1,827,718 71,726
Work-in-Progress 2,564,347,486 2,825,540,119
Finished Goods 1,223,948,386 1,113,660,400
Stores and Spares 337,678,181 375,704,192
Scrap 397,611,139 183,949,519
Other Inventory 6,745,641 10,395,624
Total 9,798,393,827 9,555,548,425
Note 18
Trade Receivables As at 31st March 2012
(`)
As at 31st March 2011
(`)
Trade receivables outstanding for a
period less than six months from the
date they are due for payment
Unsecured, considered good 5,419,298,581 6,899,430,328
Unsecured, considered doubtful 9,106,366 606,841,387
5,428,404,947 7,506,271,715
���Z����=������!������<!�'���<� 9,106,366 606,841,387
Total (A) 5,419,298,581 6,899,430,328
Trade receivables outstanding for a
period exceeding six months from the
date they are due for payment
Secured, considered good 0 0
Unsecured, considered good 7,239,385,667 2,710,645,176
Unsecured, considered doubtful 442,100,424 291,391,395
7,681,486,091 3,002,036,571
���Z����=������!������<!�'���<� 442,067,971 291,358,942
Total (B) 7,239,418,120 2,710,677,629
Total (A+B) 12,658,716,701 9,610,107,957
98
Note 19
Cash and Bank Balances As at 31st March 2012
(`)
As at 31st March 2011
(`)
a. Cash and Cash equivalents
Balances with Banks 710,122,573 2,883,095,033
FDR with Banks (Excluding pledged FDRs)
with maturity less than 12 Months from the
Balance sheet date
17,160,477,120 15,840,154,611
Cheques, drafts on hand 44,038 18,939
Cash in hand 694,327 685,940
Postage in Hand 1,277,042 863,917
b. Other Bank Balances
FDR pledged with Bank 33,000,000 33,000,000
Total 17,905,615,101 18,757,818,441
Note 20
Short-Term Loans and Advances As at 31st March 2012
(`)
As at 31st March 2011
(`)
Unsecured Considered Good
��������=�������F*"'����� 51,979,924 82,615,740
Pensionary Charges Receivable - CISF 0 38,982,265
Amount Receivable from EPF Trust 331,804,514 767,789,310
Amount Receivable from Pension Trust 93,857,972 52,047,751
�=��F����*���I����=<'��!��*�Govt of India
1,198,236,515 1,198,236,515
Advances to Supplier 1,507,283,673 251,933,505
Advances to PAO 4,062,268 3,480,428
��=�������D�% ����=�'�H���� 0 445,000
Advances (Others) 610,406 4,464,761
FC�����E���� ��D'��� 241,136 2,900,941
Excise Duty CENVAT 5,167,703 8,062,915
CST Refund Recivable 18,432,232 18,396,409
VAT/Sales Tax Receivable 49,099,097 42,634,361
MVAT Refund Receivable 38,610,503 31,780,165
FBT Advance Tax 0 6,550,000
99
Short-Term Loans and Advances As at 31st March 2012
(`)
As at 31st March 2011
(`)
Advance Income Tax A.Y 2012-13 2,210,000,000 0
Advance Income Tax A.Y 2011-12 2,520,000,000 2,520,000,000
Advance Income Tax A.Y 2010-11 2,661,196,139 2,661,196,139
TDS A.Y 2012-13 884,579 0
TDS A.Y 2011-12 55,359,593 55,209,104
TDS A.Y 2010-11 205,233,703 205,274,299
TDS A.Y 2009-10 195,369,005 396,026,620
Prepaid Expenses 8,094,435 6,564,411
Others short term loans and advances 43,790,490 1,891,584,205
Total 11,199,313,887 10,246,174,844
���Z����=������!���E��<!�'���=���� 8,323 8,323
Total 11,199,305,564 10,246,166,521
Note 21
Other Current Assets As at 31st March 2012
(`)
As at 31st March 2011
(`)
Interest Receivable on FDR 306,633,736 353,094,013
Asset Held for Disposal 13,601,459 0
PAO/C&C DEA Ministry of Finance
(EPF)
93,180,787 0
PAO/C&C DEA Ministry of Finance
(GPF)
223,669,980 0
Other receivables 9,579,129 39,657,057
Total 646,665,091 392,751,070
100
Note 22
Revenue from Operations For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Sale of Products (Gross)
Sale of Notes 13,359,511,000 10,065,682,000
Sale (Export) 77,687,735 277,170,771
Sale of Coins 13,669,126,465 14,269,779,101
Sale of Medals and Commemorative
Coins
622,635,285 305,870,442
Sale of Security Paper 5,206,948,124 5,212,370,871
Sales-Others 1,259,460,661 1,166,988,916
Total (A) 34,195,369,270 31,297,862,101
Sale of Services
Job Work 4,549,230 26,909,244
Other Services 26,853,923 20,936,078
Total (B) 31,403,153 47,845,322
Other Operating Revenues
Sale of Scrap 762,975,443 990,879,861
Other Operating Activities 9,496,528 13,374,449
Total (C) 772,471,971 1,004,254,310
Gross Total D (A+B+C) 34,999,244,394 32,349,961,733
���Z�FC�����E�����F� 51,222,189 20,333,773
Total (D-E) 34,948,022,205 32,329,627,960
���Z�I��E�!!��������!��'��D�''� 0 43,646,066
Revenue from Operations 34,948,022,205 32,285,981,895
Inter unit sales during the Year is amounting to ` 3,891,367,255 (F.Y 2010-11
`�V$�]�$O?N$A�V��������'�����������<�=���'����(������ � � �
101
Note 23
Other Income For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Interest Income (Net) 1,230,841,434 1,227,084,239
Dividend Income 63,212,729 43,179,170
Foreign Exchange Fluctuation Gains 48,630,699 30,822,770
���������'���!�S�C�������� 516,993 333,330
Other non-operating income (net of
expenses directly attributable to such
income)
87,970,323 73,748,592
���=������\ �<�'�����H�����D�� 245,334,954 907,759,374
Total 1,676,507,133 2,282,927,475
Note 24
Manufacturing Cost For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Cost of Raw Materials Consumed 16,522,274,181 15,116,346,273
Consumption of stores, spare parts
and components
390,961,809 243,494,960
Power, Fuel and Water 444,549,544 393,751,146
Repairs & Maintenance to Machinery 71,629,004 49,877,198
Repairs & Maintenance to Factory
Building
25,878,068 16,679,720
Packing Expenses 105,991,364 123,443,396
Other Manufacturing Cost 34,706,072 28,144,962
Total 17,595,990,043 15,971,737,656
102
Note 25
Changes in Inventories of
Finished Goods, Work in
Progress and Scrap
For the year ended 31st
March 2012 (`)
For the year ended 31st
March 2011 (`)
Closing Stock
Finished Goods 1,229,210,646 1,119,250,610
Work in Progress 2,698,129,944 2,799,433,737
Scrap 409,329,421 203,576,430
Total (A) 4,336,670,010 4,122,260,777
Opening Stock
Finished Goods 1,119,250,610 1,775,379,995
Work in Progress 2,812,659,917 2,232,783,668
Scrap 203,576,430 3,935,505
Total (B) 4,135,486,956 4,012,099,168
Changes in Inventories of
Finished Goods and Work in
Progress (A-B)
(201,183,054) (110,161,609)
In IGM Noida during the year, the company has accounted for work in progress and accordingly
the WIP as on 31.03.2012 is valued at ` 1069.51 lacs and WIP as on 01.04.2011 amounting
to ` 132.26 lacs is accounted for by crediting to prior period adjustments.
Note 26
=�+��������������=4+���� For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Salaries, Wages and Allowances 4,401,855,997 4,121,139,835
Overtime 1,042,562,678 943,833,977
Incentive 936,169,365 1,050,194,742
+� 23,126,620 31,763,323
Medical 123,192,189 94,338,257
Employer Contribution to EPF 300,672,139 265,257,394
�=���'������������������(���Contribution
270,370,809 83,921,604
�����<�����������) ���������+��� 18,547,741 21,460,947
�=��F����*�� 176,246,740 325,235,109
Gratutity 137,161,520 202,832,448
Staff Welfare Expenses 21,375,633 7,142,379
#����F*"'�����D����� 169,683,460 180,249,994
Total 7,620,964,891 7,327,370,009
103
Note 27
Other Expenses For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Advertising Expenses 51,993,446 19,891,268
Commission (Auction & Other) 25,376,285 46,485,810
Audit Fees 2,629,112 1,996,407
Bad Debts written off 0 33,579
Bank Charges 423,425 769,139
Canteen Expenses (Net of
Receipts)
14,153,399 12,170,736
Dispensary Expenses 30,499,311 39,268,848
Environmenal Charges 9,840,949 10,547,731
Fees & Honorarium 5,558,068 10,343,642
Freight Outwards 66,353,581 50,484,036
Foreign Exchanges Fluctuation
�����11,386,747 1,538,394
Grants in Aid Expenses 275,930 289,160
��������'�\E�������!������ 117,593,312 9,273
Guest House Expenses (Net of
Receipts)
22,249,421 19,607,367
Hiring of Staff 19,674,424 11,050,230
Horticulture Expenses 5,789,158 4,079,441
Hospitality & Entertainment 13,971,555 9,918,255
�('������!������'����(�� 54,100,218 39,380,377
Meeting Expenses 228,157 214,173
Misc. Expenses 2,747,983 22,941,353
#!����FC"����� 4,794,005 7,329,636
Postage & Courier Expenses 8,007,913 7,469,651
Printing & Stationery Expenses 7,384,114 9,226,235
Research & Development
Expenses
23,493,947 48,994,436
Repair & Maintenance- Building 141,184,617 103,158,706
Repair & Maintenance- Computers 6,418,490 6,560,592
104
Other Expenses For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Repair & Maintenance - Others 28,841,984 27,344,829
Rent 47,741,163 44,388,995
Insurance 2,439,227 1,842,481
Rates & Taxes 15,108,665 23,666,677
Security Charges 604,218,101 556,726,980
Seminar & Training Expenses 12,325,344 10,289,040
Service Tax Paid/ Sales Tax 0 56,716
Subscription, Newspaper, Books &
Periodicals
1,591,489 1,819,949
Telephones & Internet Charges 17,822,520 14,929,808
Travelling & Conveyance Expenses 58,573,830 55,100,441
Travelling Expenses Foreign 5,523,910 7,875,731
M��!��*��� �=����� 3,370,752 4,459,135
Corporate Social Responsibility
Exp (CSR)
43,640,497 38,949,619
Vehicle Hiring/ Maintenance
Charges
18,400,449 16,720,809
Water & Electricity Charges 47,291,505 46,993,237
Others Expenditure 53,754,404 19,698,007
Total 1,606,771,404 1,354,620,929
Note 28
Provisions For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Provision for Bad Debts/Advances
Opening Balance 1,736,478,360 1,543,190,075
Provision Made during the Year 153,390,840 606,651,598
Provision reversed during the Year 761,439,539 413,363,613
Adjustment During the Year (Due to
diff. in Opening and Closing Balance)
597,704,598 0
Closing Balance (A) 1,726,134,259 1,736,478,060
105
Provisions For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Provision for Obsolete/Non Moving
Inventory
Opening Balance 49,284,232 54,861,149
Provision Made during the Year 4,289,319 13,583,351
Provision reversed during the Year 2,450,528 19,160,268
Closing Balance (B) 51,123,023 49,284,232
Total (A+B) 1,777,257,282 1,785,762,292
Note 29
Prior Period Expenditure For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
MACP Arrears 0 47,791,614
Payment in lieu of
Commpassionate Appointment
0 31,950,597
Incentive Bonus of F.Y. 2009-10 0 14,518,778
Arrears Payment 0 149,512,493
U�+� �<�'�� 1,001,000 0
Gratuity 0 2,140,587
Bonus to Employees 0 3,398,564
Excise Duty paid on demand for
the period 10-02-06 to 28-02-10
0 18,021,644
Interest on Excise Duty on demand
for the period 10-02-06 to 31-08-08
0 4,001,199
EMD Forfeited for 2009-10 0 12,700,029
Prior period Exp. (Units) 29,734,726 0
Insurance Expenses 6,609,536 –
Other Prior Period Expenditures 11,910,930 16,938,698
Total 49,256,192 300,974,203
106
Prior Period Income For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
Revision of Provision for Pension
Charges
0 22,703,171
CISF Pensionary Charges excess
payment paid reversal
0 26,936,650
Recievable from CISF 0 13,808,132
�Q������E*(���?AA�K�� 1,534,403 0
Purchase Blanks 18,807,329 0
Opening WIP Adjustment 18,884,708 0
�F���!!��������!�%D����'��transferred by IGM, Mumbai
3,067,929 1,997,347
Prov for Depreciation Written Back 136,880 0
Prior Period Income (Units) 3,783,394 0
Other Prior Period Incomes 7,988,342 1,732,153
Total 54,202,985 67,177,453
Note 30
Payments to the auditor as For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
a. Auditor 1,460,680 1,400,230
b. For taxation matters 503,829 602,514
c. For company law matters 0 0
d. For management services 0 0
e. For other services 631,457 10,000
f. For reimbursement of expenses 144,249 166,113
Total 2,740,215 2,178,857
107
Note 31
Consumption of Raw Material
under Broad HeadsFor the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
CWBN Paper 4,810,170,986 4,167,824,508
Security Paper 1,381,207,127 1,099,655,193
Ink 1,750,268,300 1,608,968,153
FSS Coil 3,133,320,718 3,097,030,538
NiBR Coil 3,333,084,543 4,312,499,683
FSS Blanks 1,717,749,970 1,243,859,485
NiBR Blanks 236,399,096 579,651,703
Bi-Matelic ` 10 Blanks 2,843,375,829 1,333,883,822
HAUV Film 95,585,744 92,504,554
Chemicals 62,480,300 63,099,124
Security Fibre 18,369,050 21,713,043
Security Thread 169,383,678 244,386,455
M-Feature 32,732,776 102,377,671
Furnace Oil 156,550,223 65,615,908
D'����������� ���� 62,638,268 103,245,072
Comber 312,526,143 147,657,929
Total 20,115,842,751 18,283,972,840
Note 32
Work in Progress under Broad
HeadsFor the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
W.I.P of Notes 1,131,990,477 1,523,187,694
W.I.P of Coins/Blanks 1,019,770,623 689,601,571
W.I.P of Ink 38,804,367 147,561,202
W.I.P of Security Paper 37,720,405 33,583,180
W.I.P of Postal Items 3,791,957 6,542,038
W.I.P of Non-Postal Items 268,087,135 119,935,242
W.I.P of Travel Documents 2,930,111 87,459,818
Total 2,503,095,075 2,607,870,745
108
Note 33
Value of imports calculated on
C.I.F. basis by the company during
�#������ ��������� ��� ���+� ���� (�(On Accrual Basis)
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
1. Raw Materials 4,032,371,722 4,310,858,419
2. Stores, Components and
Spare Parts
156,920,994 88,058,425
3. Capital Goods 387,230,362 838,305,924
Total 4,576,523,079 5,237,222,768
Note 34
Expenditure in foreign currency
������� �#�� ���� ���� ����� ���account of : (On Accrual Basis)
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
1. Royalty, Know-how, Professional
and consultation fee
655,109 0
2. Conferences 516,031 0
3. Foreign Travel 2,601,316 5,865,511
Total 3,772,456 5,865,511
Note 35
Consumption of Imported raw
material, stores, spare parts and
components as compared to
Indigenious raw material, Stores,
spare Parts and components
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
(A) Total Value of all imported raw
material consumed
4,884,227,336 4,845,617,417
(B) Total Value of all indigenous
raw material consumed
11,638,046,845 10,270,728,856
Total (A+B) 16,522,274,181 15,116,346,273
% of A to total (A+B) 30 32
% of B to total (A+B) 70 68
109
Consumption of Imported raw
material, stores, spare parts and
components as compared to
Indigenious raw material, Stores,
spare Parts and components
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
(C) Total Value of all imported
Stores, Spare parts &
components consumed
119,989,588 76,118,779
(D) Total Value of all indigenous
Stores, Spare parts &
components consumed
270,972,221 167,376,181
Total (C+D) 390,961,809 243,494,960
% of C to total (C+D) 31 31
% of D to total (C+D) 69 69
Note 36
Earnings in foreign exchange
����������������#������.����heads, namely:-
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
1. Exports of goods calculated on
F.O.B. Basis
79,557,000 193,830,708
Total 79,557,000 193,830,708
Note 37 Contingent liabilities and Committments
Contingent liabilities and
commitments (to the extent not
provided for)
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
�)�������(��� �<�'����
(i) Claims against the company not
acknowledged as debt (Excluding
legal cases where amounts are
unascertainable)
���������'���<���*"'�����\;������ 2,209,292,630 2,342,064,106
�<��������'���<����""'���� 6,854,970 6,794,458
110
Contingent liabilities and
commitments (to the extent not
provided for)
For the year ended
31st March 2012 (`)
For the year ended
31st March 2011 (`)
(c) Octroi Penalty 2,387,951,690 238,79,51.690
(d) Demand of VAT on Currency Coins 807,201,016 0
(e) Sales Tax Dispute 2,236,278,771 2,015,735,170
(ii) Bank Guarantees 36,865,000 3,865,000
������ �����!��������������<��D��� 247,803,931 2,818,871,588
(iv) Income Tax Penalty A.Y. 2006-07 5,712,718 0
(iv) Others 193,853,488 326,490,331
Total 8,131,814,214 9,901,772,343
(II) Commitments
(i) Estimated amount of contracts
remaining to be executed on capital
account and not provided for
3,714,069,425 3,157,729,631
(ii) Other commitments 0 0
Total 3,714,069,425 3,157,729,631
Note 38 Deposit against Contingent Sales Tax Liability
Sales Tax was collected under account head named “Deposit against Contingent Sales Tax
�<�'��`��"��S�X�?AAWKA���������'��"�������E����(����S�X�?AA�KAN����������;��������as sales tax is not payable on sales of security items to State and Union Territory government
and therefore the same may not be collected and sales tax collected between 10.02.2006 to
31.03.2008 was credited back to customers Sales tax collected upto 10.02.2006 amounting
to ` 202,228,399 is being shown as liability under the head other long term liabilities.
Note 39 Inter Unit Transfer
Inter Unit Transfer are made at Budgeted value.
Note 40 Assets & liabilities taken over
a) As per the Govt. decision, all the assets and liabilities of above mentioned nine units
������A�A?�?AA]����<�������!������������) �����������'�<�'�����"��=�'��(��� ��� AN�A?�?AA]� ;���� ���� �=��� ��� �A�A?�?AA]� ��� ��� <����� �!� ����) � ���historic cost basis as per books of the Government Units.
111
b) The proforma accounts were prepared by the units before their corporatization as
a subsidiary account. It was in addition to the Govt. accounts prepared by Ministry
of Finance. In the units, proforma account was not up to date as on 09.02.2006 i.e.
the date of corporatization. It has now been prepared by all units and due for audit
by C&AG in some cases. Finalization/Audit of Proforma Accounts up to 09.02.2006
��;�''���"�����'�=����������!�������!�''������*��!!������*����"�<'��to the government as well as assets and liabilities of the Company.
c) After the transfer of assets & liabilities from government to company, it is required
to take necessary steps to get the title deed changed in the name of the company.
Efforts are being made to consolidate the revenue records pertaining to ownership,
thereafter process will be initiated to transfer the title of immovable properties as
per the guidelines of Department of Public Enterprises.
Note 41 Withdrawn Coins
Withdrawn coins are received in the mints for melting. These are received by Mints from
Government and Mints act as custodian to it. After melting, metal is auctioned on behalf
of Government. Metal value of the stock is given cognizance as credit to government after
levying processing charges of melting etc. Practice being followed in the unit has been
formalized through detailed guidelines.
Note 42 Pricing of Coins/Notes/Postal Items
Coins: The selling price of different denomination of coin for the F.Y 2011-12 has been
worked out based on the actual production cost for the year 2010-11 as calculated by WIRC
of Institute of Cost Accountants of India with adjustment in metal price for the F.Y 2011-12.
The rates at which billing is being made to the Ministry of Finance is subject to settlement
with the Ministry of Finance.
Notes:� ������(� ��'�G���� �!� �����(� �!� %���$� ��''��(� "����� �!� %���� ;���� ���������provisionally by 10% to meet out the increased cost of production during F.Y 2011-12,
however these increased rates are yet to be accepted by RBI.
Postal Items: The rates at which billing is being made to the postal authorities is subject to
settlement with the authority. The revenue from transaction with the postal authorities as well
as receivable from the same are subject to settlement/reconciliation. An outside professional
body has been appointed to carry out the costing of the products and costing report is likely
to be received shortly.
Note 43 Disclosure pertaining to Micro, Small & Medium Enterprises
The management has initiated the process of identifying enterprises which have provided
(����������=����������M�����;�����Q�'�!���������������������!������$��*''��������*�F���"�����$��������������������$��*''��������*�F���"������E�=�'�"*�����$�?AA]��Accordingly the disclosure in respect of amount payable to such enterprises as at 31st March
?A�?� ��� <���� *��� ��� ��� �����'� ��*���� ��� ��� <���� �!� ��!��*���� �����=��� ��available with the company. Further in view of the management, the impact of interest if any
112
that may be payable in accordance with provision of the Act is not expected to be material,
therefore provision for the same has not been made in books of accounts.
Note 44 Fixed Assets
a. As per the Ministry of Finance O.M. dated 10th February, 2006 all assets and
liabilities have been taken at the book value, Pre-acquisition, the units, being
commercial entity, has been maintaining the assets details at Gross Value and
���!�'�'�!���!������;�����C����������('�������*�'�����"���������������*��as appearing in the books of vendor has been carried forward in the books of
����) ��S������!������"��"�����!���"������������*��������'�'�!�����<���(�continued.
<�� +��� �'�� !��� ��� �**�=<'�� "��"������ �*�'�� ��� ��� D��'���(� ��� ��� �� <��transferred in the name of the company. Efforts are being made to get the title
deed/lease deed transferred in the name of the company.
��� ������'�=����������!�S�C��������������(���������'�����?A��K�?�������<����carried out at CNP Nasik, SPM Hoshangabad, BNP Dewas, IGM Hyderabad and
IGM Noida.
Note 45 Lease Premium (IGM Noida)
The land at Sector-1 and Sector-23 held by IGM Noida are taken on long term lease of 99
year w.e.f 3rd May, 1985 and 90 years w.e.f. 12th May, 1993 respectively from Noida Authority
;����������������<����P���������"��*��*�"���!���'����������&�=���*�������������was not amortized over the period of lease. Now in term of AS-19 regarding accounting of
leases, the basic premium paid for acquiring the lease is written off over the balance period
of the lease starting from 10.02.2006 i.e. date on which all assets and liabilities transferred to
the Corporation and ending on the date of termination of lease as per the lease deeds.
Note 46 Municipal Tax
a) With regard to the amount of ` 122.31 lakhs recoverable from Municipal Corporation
of Hyderabad, being the amount paid by the Unit during the period 2001-06 as
property tax/service tax which in the view of C&AG was not in line with Article No.
285 of Constitution of India read with Supreme Court judgment. As observed during
the audit in the year 2004-05. The matter for getting the amount refund from GI-IMC
is being followed up by SPP.
b) During recent C&AG transaction audit it was observed that the title to the property
���������!������������) $�������������������������"�����*�����"'�C���<��SPP.
c) The GHMC has raised a claim for ` 97.91 lacs as service charges upto the year
2011-12 including arrear. On scrutiny it is found that there are some errors in the
calculation sheet of 2010-11 & 2011-12 which was furnished by GHMC. The amount
�!����=�������(�������C����WRB��!�"��"����C���"���&T���E�#� +�%���W�A\
113
CTS/MCH/2000. In the year 2010-11 & 2011-12, the amount of property tax should
be ` 3,263,988 and hence the service charges shall be ` 2,447,991 for the year.
So total service charges of ` 7,343,973 are liable upto the year 2011-12 including
arrear. As there is an existing provision of ` 5,743,370, the balance amount of
` 1,600,603 has been provided during F.Y. 2011-12.
d) Mean while Unit has also taken legal advice and accordingly requested GHMC to
adjust, the present claim from ` 122.31 lacs which was made by mistake to GHMC
during the period 2001-06.
Note 47 Precious Metals at Mints
Mints at Mumbai, Kolkata and Hyderabad have limited stocks of gold, silver and other precious
metals. As normal business of the company, small quantity of these metals is accumulated
every year. Metals are required in the medallion/medal business depending upon the type
of medal to be manufactured. There is a sound system of maintaining records and ensuring
"�����'� �!��� �!� ��� *�'��� E��'��� <���K�"� �!� ���� ��(���� �!� *�'� ;��� ��������details are available in the units. Value of these metals has been taken as per book value
which is lower than the market value of the same.
:�����)� =�+�������������Most of the Employees of the company were on deemed deputation from Government of
)�����#���R�AN�?AA�$����"����(���*���;����(����<�;�������(�=���*��$�����) �and the representatives of the various unions. Option was given to employees who were
������*�����"��������"�����) ����&�=����"���I�'��VWK���!�����'���=�'����=��������������� I�'��$� �NW?�� ���*���� <���"���� ��� <���� ������� <�� &�=�� =���� ������%��� �A\�\?AANK����� ���� ?N�AR�?AAN� ;���!�� A�����?AA��� #"���� �� J���� ����) � ;��exercised by 14256 employees.
,������1����������������a) Employee Provident Fund (EPF): For EPF, a trust has been established and
exemption has been granted by Employees Provident Fund Organisation in the
month of December, 2009. This trust became operational w.e.f. April, 2010 and
now all cases pertaining to employees provident fund matter are being looked after
<�����+�����#"����(�<'������!�"�����*"'������;�������!������������) �EPF Trust from PAO of the respective units except in case of 372 employees
�!� ��� ��*"��� ;����� ��� ������ "��(������ ��*"��� "��� �C��� �����<����� ��provident fund at predetermined rates to this trust, which invests the funds in
permitted securities. Contribution to family pension scheme is paid to the EPFO.
+��������<����� ��� ����(��G������C"�������� ������(��� �� ���"������� '����account.
b) General Provident Fund (GPF): For GPF, a trust has been established in the month
of March, 2011. This trust became operational w.e.f April, 2011. From 1st April
2011 employee’s contribution is being made to the trust. Opening balances of the
114
��*<������"�����*"'������;�������!������������) ��S�+����!��*���#��!����respective units except in case of 139 employees of the company which are under
progress. There is only employee contribution in this fund therefore, no amount is
����(��G������C"��������"�������'����������
,������������������c) Pension:���������;�''�<��"�������*<�������������#"����!��*�����) �F*"'������
Pension Fund Trust constituted by Government of India. Provisions for pensionary
contribution to the trust in respect of the Combined Optees have been made as per
Government Rules.
d) Leave Travel Concession:� �=�� +�=�'� ����������� � +��� <������ �=�� <����dealt with as per norms of Government of India adopted by the company.
e) Gratuity:�+�����*"��������������<�����(�����"'���F=�����*"'�����;����������������������������=�����!��=����������*����������'�����(��(�������R�����salary (15/26 × last drawn basic salary plus dearness allowance) for each completed
year of service subject to a maximum of ` 10 lacs on superannuation, resignation,
termination, disablement or on death. The liability for the same is recognized on the
basis of actuarial valuation.
f) Leave: +��� ��*"��� "��=����� !��� ������ '�=�� <����� ��� �'!� "�� '�=��to the employees of the company which accrue Six monthly at 15 days and 10
days respectively. Earned leaves is encashable up to a maximum of 300 days on
separation. Half pay leave is encashable only on separation but subject to maximum
of 300 days for both earned leave and half pay leave. The liability for the same is
recognized on the basis of actuarial valuation.
(` in crores)
Sl.
No.
Particulars Gratuity Leave
A Net liability recognized in the Balance Sheet
at 31st March, 2012
Present value of unfunded obligation 34.84 198.23
%�� �<�'�� 34.84 198.23
B =4+������� ����>�������#��������������+��������������for the year
Current Service Cost 10.28 5.40
Interest on obligation 1.66 15.06
Net actuarial losses(gains) recognized in the year 2.22 2.96
+�'����'���������*"'�����<������C"���� 14.16 23.42
115
Sl.
No.
Particulars Gratuity Leave
C 1#����������#��+����������������������������������������representing reconciliation of opening and closing balance
thereof:
#"����(��������<������<'�(��� 20.70 188.27
Service Cost 10.28 5.40
Interest Cost 1.66 15.06
Actuarial losses/(gains) 2.22 2.96
D������"�� (0.02) (13.46)
�'����(��������<������<'�(��� 34.84 198.23
D Changes in the fair value of plan assets representing
reconciliation of opening and closing balances thereof:
Opening fair value of plan assets - -
Expected return
Acturial gains/(1osses)
Contribution by Employer
D������"��
Closing balance of fair value of plan assets (0.02) (13.46)
E Principal actuarial assumptions at the balance sheet date
(expressed as weighted averages)
Discount Rate 8.50% 8.50%
Expected return on plan assets - -
Attrition Rate 1.00% 1.00%
Annual increase in salary costs 7.00% 7.00%
Note: The estimates of future salary increase, considered in actuarial valuation, take account
�!���P���$���������$�"��*���������������'�=��!����$����������""'�������*������employment market.
Note 49 Segment Reporting
In the opinion of management segment reporting as envisaged in AS-17 is not applicable as
risks and returns associated with product categories are not different. Most of the products
are manufactured for and supplied to Government organizations on cost plus basis. Further
����) ������((��������=����(��!��������!�*��!�����(��!���������"�������
116
Note 50 Provisions
A provision is recognized when the company has obligation as a result of past event and it is
"��<<'���������P�;��!��������������;�''�<����Q����������'������<'�(���$�������"���of which a reliable estimate can be made based on technical valuation and past experience.
Provisions are not discounted to its present value and are determined based on management
estimates required to settle the obligation at the balance sheet date. No provision is recognized
for liabilities whose future outcome cannot be ascertained with reasonable certainties. Such
contingent liabilities are not recognized but are disclosed on the basis of the judgement of
���*�(�*����+����������=��;��������<'����������������J���������P������current management estimate.
Note 51 Related Party Transaction
��� ��� +��������� �!� ��'��� "����� �� "��� ��������(� ������K��� {I�'��� ����Disclosure’ issued by the Institute of Charted Accountants of India:
Name of the Party Relationship
D���%����"�����''�)�������=�� ��� �����U�����
Joint Venture: The company has entered into a Joint Venture Agreement with Bhartiya
I����=�� D��� %��� ������ ���=�� �*���� �DID%�� �$� � ;��''�� �;���� ��<������� �!�Reserve Bank of India to set up a Security Paper Mill at Mysore with 50% participation
in equity by each Joint Venture partners by forming a company under Indian Companies
Act, 1956 on 13.10.2010. The project is under implementation as on 31st March 2012. The
company has contributed a sum of ` 200 crores towards 50% capital contribution. Company
has been allotted 10,000,000 equity shares of ` 100 each aggregating to ` 100 crores till
31.03.2012 and a sum of ` 100 Crore is being shown as share application money pending
allotment as on 31.03.2012 which has been allotted on 30.05.2012. Their accounts are yet
��<����'�G���
(` in lacs)
Transaction: 2011-12 2010-11
Capital Contribution 9995.00 5.00
Conversion of Share Application Money to Capital (9995.00) 0.00
Share Application Money (Pending Allotment) 10000.00 9995.00
Key Management Personnel:
� Shri M.S. Rana, Chairman and Managing Director.
� Shri Ashwini Kumar, Director (Technical).
� Shri Madan Mohan, Director (Finance) upto 13.10.2011
� Dr. Manoranjan Dash, Director (HR).
117
There are no transactions with Key Management Personnel during the year, except as given
<�'�;��+�������������������������;�����'���"�������������������K���
The gross remuneration to Key Management Personnel who have been the fulltime-Directors
of the Company is as under:
(Amount in `)
Particulars 2011-12 2010-11
Salary and Allowances 10,484,910 9,708,971
Contribution to PF/ Pensionery Charges 441,062 606,940
�=��F����*�� 1,471,913 249,389
����I�����#��������� 4,167,635 3,941,427
Gratuity 553,555 589,785
Total 17,119,075 15,096,512
Note 52 Earnings Per Share
(Amount in `)
Particulars 2011-12 2010-11
������!���+C��`) 5,824,659,581 5,771,923,538
No. of Shares outstanding 50,000 50,000
Basic/Diluted Earnings per share (`) 116,493 115,438
Note 53 Deferred Tax
+�����(��������*"����������'����������!���!������C��������'�<�'���������������!��*"�������!!������������(���������'�����?A��K�?���Z
Particulars (Amount in `)
Opening Balance of Deferred Tax Assets 934,660,212
Add: Deferred Tax Assets (Net) created during the year (200,721,157)
Closing Balance of Deferred Tax Assets 733,939,055
)�� ��� �"������ �!� D���� �!� E�������$� ������� �����$� ��� �� ��=����� �=�� � ='��� ���realization in the ordinary course of business at least equal to the amount at which they are
stated.
Note 54 Transactions in Foreign currencies
Transactions in Foreign currencies are accounted at prevailing rates on the date of transaction.
All exchange rate differences in respect of foreign currency transactions are dealt with in the
������� �����������C��"��������'��(����Q���������!�S�C��������$�;���������J�����in the cost of the assets.
118
Note 55 Gold lying with RBI
�R$RRR�&*���!�(�'��'���(�;���ID)�����**����!���&�����������'��������!���?AA]KAW���Out of the above, gold weighing 10,336 gms was already accounted for in 2006-07, under
the head Gold with RBI, the possession of which is with RBI. IG Mint Mumbai will be arranging
to take over possession of the same. As regards the balance 75,219 gms. IGM Mumbai has
received a letter from RBI dated 06.06.2008, Ref No By. Cy. No. 5047/01.11.044/2007-08,
�����(�'�������'��<����*����<��'!��!���<'���E�<�#!���$�ID)$���*<���+����!���$�����gold does not belong to the unit, and hence the same has not been considered in the
accounts.
Note 56 Security Deposit Paid
Security Deposits have been made with various Electricity Departments/Boards and
companies by the units to get electricity connections and supply. Most of these deposits have
been made prior to corporatisation.
Note 57 Funds from Govt. of India (adjustable)
As per the Government of India decision, all the assets and liabilities of Govt. of India
Presses, Mints and Mill working under Department of Economic Affairs. Ministry of Finance
�� ��� �A�A?�?AA]� ��� <���� ���!������ �� ��� ����) �������� ��� '�<�'����� �=�� <����taken on book value. Assets and liabilities prevailing as on 09.02.2006 were taken over on
�A�A?�?AA]� ��� ���<������!�����) ���� ���<�����!�=�'<'�� ��!��*�����+�����!!�������between value of all assets and liabilities as on 10.02.2006 represents the amount of funds
!��*�&�=���*��������(�����!������ ���!����!��������� '�<�'�����������'�G���\�����!����!�*����������"��AN�A?�?AA]���;�''���"�����'�=����������!�������!�''������and subsequent developments may affect the amount payable to the government as well as
assets and liabilities of the Company, the amount of Fund from Government is adjustable to
such an extent. There is a net increase of ` 1,161,767 over previous year.
Note 58 Impairment of Assets
(a) As per AS-28, the carrying amounts of assets are reviewed at each balance sheet
date if there are impairment indication an impairment loss is recognized wherever
the carrying amount of an asset exceeds its recoverable amount. The recoverable
amount is the greater of the asset’s net selling price and value in use. In assessing
='���������$�������*���!���������P�;����������������������"������='����the WACC.
(i) After impairment, depreciation is provided on the revised carrying amount of the
asset over its remaining useful life.
(ii) A previously recognized impairment loss is increased or decreased based
on reassessment of recoverable amount, which is carried out if the change is
��(�������T�;�=������������(�='���!�����=���'����������������<������the carrying value that would have prevailed by charging usual depreciation if
there was no impairment.
119
(b) In the opinion of Management, assets which are impaired by disuse or obsolescence
have not been segregated from the concerned assets category and are not shown
as decommissioned assets.
���� )�������!����$�T����(<��"�����'�=����������!��C��������!������"��"����of determining impaired assets was carried out by an outside agency but the report
has not been accepted by management therefore no provision has been made in
<������!���������+�����������������!����*"��*����=���;�������;��='����!�` 19,161,854 as on 31.03.2011.
(d) In case of IGM Hyderabad, provision for impairment has been made for an amount of
` 77,467,757 for assets where carrying amount of an asset exceeds its recoverable
amount.
���� )�������!�����T����<�$�''� ��*���!��'���������������C��"� ;��) ���%�;����������������������(�������������(������(����K��KP�;��������(��G���������$�����������������������!��*"��*����+���������(�='����!�;��) ���%�;�Machines as on 31.03.2012 is `��OV$�?W�����������=��<'��='����!����;��) ��(New) machines is ` 250,000. The excess of carrying value over recoverable vaue
of machines amounting to `�RNV$�?�����<��������(��G�����)*"��*��� ����
(f) In case of lSP, Nashik during the year the unit has principally approved assets
having gross block at ` 267.56 lacs for the purpose of impairment, the net block of
the assets existing in the books as on 01.04.2011 was at ` 2.30 lacs. Considering
an estimated realizable value of ` 4,409, the remainder of amount of ` 2.26 lacs has
been booked under the impairment loss. Although the assets have been approved
for the impairment, pending the disposal, the values of assets have been disclosed
�������C�������������������*���'������^��������'��!������"��'�\�`�����nominal value which also includes the estimated realizable value of asset.
Note 59 Slow Moving/Non Moving Inventory
Company is holding stock of slow and non moving items like stock of CN Coils, PN cathodes,
stock of pure nickel etc aggregating to ` 147.46 crores. Provision of ` 5.03 crores (Previous
Year ̀ 4.93 crores) has been created against those obsolete/non moving items where market
value is less than the book value.
)�������!�����T����(<�$����������������!�%��K*�=��(\�'�;K*�=��(�����<��'���inventories has been assigned to an external agency. The said agency completed the inventory
=��������������"��������!������<*�����+�����=��������;�����������<'�����������''�$�has been removed from the books by debiting to the respective Consumption account. The
total value of such double created items is ` 24,425,287. The inventory value is thus reduced
by the said amount.
The list of slow and non-moving items is prepared, but no provision is made in the books
!�������*��������*�����<���(�=�������<�����*�(�*����+���"��=������!�������*��
120
��''�<��*��� ��� ���<����� ��� ������� ���;���������=������������""��='�<�� �������management is obtained. The total value of slow & non-moving item as per report submitted
by the agency is ` 55,273,084.
In case of IGM Mumbai the slow/non-moving items included in inventory were physically
=����������='�������K�=���='��������AN�A?�?AA]��+�����*"'�����;�����K?������*��of basis of valuation is pending ascertainment.
Note 60 House Building Advance
Interest on House Building Advance outstanding as on 31.03.2011 has not been charged for
���"������!��*�A��A��?AAN���V��AV�?A����C��"�!���!�;�TD�� ������*����������<����;��������������������!����������'�*����!�T�����D��'���(� ��������''��������'�����with Ministry of Finance. The company has repaid housing loan to Government on behalf of
the employees which has been granted before corporatisation but the mortgage deed has
not been transferred in the name of the company.
Note 61 Discontinued Operations at Saifabad Unit (Discontinued IG Mint)
IG Mint, Hyderabad has discontinued Minting Operations of its Saifabad Unit, Hyderabad
with effect form 01.11.2009. Net Block of Fixed Assets with the Unit as on is ` 1,782,133
after making Provision for Depreciation of ` 1,966,463 (Previous Year ` 3,748,595 and the
provision for depreciation was ` 2,603,211) for the Current Financial Year. However, it is
��!���'��������������*"���!������������(�����"������$�����"���<������!��������are not being maintained relating to the said Unit.
Note 62 Employer reimbursement for Mobile Hand Set
Mobile Phone Instruments purchased by the staff entitled as per the policy of the company
and reimbursed by the company, have not been capitalized but charged to the revenue.
Note 63 Liability for Property Tax
+���"��"����C�'�<�'��������� �����D��'���(��;����<������������������=���'��(�;���assets and liabilities as on 10.02.2006 is a matter of dispute on which the company intends to
seek legal opinion. Where as provision/payments towards the same has been made at some
����$������������������*��������<��������������������������'��������
Note 64 ERP
During the year company has incurred a sum of ` 11,112,335 on ERP which is shown under
the head “Work in Progress-ERP” besides an opening balance of ` 345,404,493. Out of this
amount a sum of ` 209,664,384 has been capitalized during the year subsequent to the
&�K �=�������*"'������!��<�'������"�����!������V�������+�����*����(�*�����!�` 146,852,444 shall be capitalized on stabilization of SAP in all units.
121
Note 65 Research and Development
The details of R&D expenses are given below:
Sl. No. Particulars Amount (in `)
1. Capital Expenditure 22,819,417
2. Revenue Expenditure 23,493,947
Total 46,313,364
Note 66 Advances
Advances includes a sum of `��WA����'���*�������(�� ����������$�?AAN�<���(��AB�S#D������!��Q��"*��� ��<����������C����(�*��������!��� �������!�'� ���''�������training the equipment was found defective. The same was brought to the notice of the
vendor and the company has received the replaced equipment after March 2011. Pending
successful handover of the equipment to the company, the same was not capitalised in the
books of accounts.
Similarly a sum of ` 58.23 lacs has been advanced to the same supplier being 95% of cost
of spares in previous years which has not been settled as on balance sheet.
Note 67 Treatment for Non Moving Paper
Inventory Includes stock of paper (Imported) at ` 285,778,081 (430.00 MT) (BNP) and
` 239,393,161 (13376 Reams) (CNP) procured from foreign company. Due to Quality Issue
the same is not being used by the company. The management is of the opinion that the net
realizable value of the paper is equivalent to its carrying cost in books hence no adjustment
is required to be made in books on this account.
Note 68 Accounting Treatment for Shop Floor Inventory
As per the prevalent practice the imported spare parts/stores issued from main stores to
security stores situated at Shop Floor are accounted as consumed irrespective of its actual
consumption in the process of production. The imported spare parts not actually consumed
at the year-end and lying at the Shop Floor have not been returned to the stores and
consequently not reversed to stores inventory. Hence the value of unused/unconsumed
�"��������"�P�����������K������������"�����������H����������(�����
Note 69 Expenditure incurred towards Corporate Social Responsibility
During the year the company has incurred an amount of ̀ 43,640,497 on CSR. CSR activities
include expenses incurred for the purpose of construction of new school building, work related
to road widening etc.
Note 70
+���"��=��������L���(������=��<��������\�����\���'������$�;����=�����������$��������*�������������L���'���������
122
Note 71
Revenue is recognized net of applicable taxes and levies in respect of: (a) sale of currency
note, coins, passport, postal items, weights, measures & medals etc. is recognized on
dispatch. (b) Job work charges are recognized upon approval of the job by client and dispatch
thereof.
Note 72
In IGM Mumbai, the liability on account of penalty/interest in respect of delayed payment of
employer contribution of EPF for the period 01.11.2008 to 28.02.2010 is pending ascertainment
and has not been provided for in these accounts.
Note 73
In IGM Mumbai, old items of consumables & spares worth ` 1,858,736 have been written off
during the year.
Note 74
In IGM Mumbai, Plant & equipments includes machines having gross block value ̀ 57,171,802
and W.D.V. woth ` 5,118,606 as asset held for disposal as on 31.03.2012.
Note 75
E�"�����������"��=���������'�(�<'��������!��'����������������"�����������"����������Schedule XIV to the Companies Act, 1956 except at SPM, Hoshangabad where depreciation
on single shift basis has been provided even for assets used for triple shift basis.
Note 76
In IGM Hyderabad, value of inventories includes other raw material value to the tune of
` 88.95 crores (previous year ` 91.02 crores) which are not being used in current production
process. (Nominal quantities are used for medal manufacturing activity)
Note 77
In IGM Hyderabad a sum of ` 2,118,367 was paid towards excess custom duty on Import of
%�;�D'����(� ���$������]A������(��������?AANK�A������!�����'�*����<����'��(���;���Customs Authorities, Chennai.
Note 78
In case of IGM Kolkata, Management has carried out technical evaluation of Fixed assets
�����(�������������������������������!���;�����!!��NAB��!�;�������;��='����!������assets amounting to ` 117,238,133 has been written off during the year and the balance 10%
has been disclosed as assets held for sale.
Note 79
)����� �!� )&�� %���� �����(� ��� ���$� ��� ���� ��� ��������� ��� �����=���<'�� "'�� ��machinery of `�]�A��'���������"��=������!�������������C���������!�` 6.01 lacs is shown
123
under provision for impairment. The total provision for impairment loss at the end of the year
stood at ` 62.26 lacs (previous year ` 56.25 lacs).
Note 80
Incase of IGM Noida, the non-circulation coin lying in IGM, Noida received from other units
is not valued as the same are not held for sale and the revenue shall be recognized only on
disposal.
Note 81
)�������!� )&��%���$� ��� '��������� ������"����!� '�����KVV$������K?V����O�P���Sector-27 are not available.
Note 82
In IGM Noida, during the year, the unit has installed and commissioned fully automatic
integrated sachet packaging machine at a total cost of ` 570.56 lacs. A sum of ` 30.92 lacs
��������������"����!�"���;�����;�����*(��������(���������<�������(������������ �����������+�������������'�*�'��(���<������������"�����(�!�����'�*��$�;�������''�be accounted for on receipt basis.
Note 83
In IGM Noida, during the year, the company has accounted for work in progress and accordingly
the WIP as on 31.03.2012 is valued at ` 1,069.51 lacs and whereas WIP as on 01.04.2011
amounting to ` 132.26 lacs is accounted for by crediting to prior period adjustments.
Note 84
In IGM Noida, Gain/loss due to weight variations was accounted for by the unit by adjusting
the cost of production in the absence of accounting policy.
Note 85
)�� )&��%���$�"�����(���'��'��'���$� ����������*����"��=�������!�` 45.02 lacs on
account of arrears for anomaly in VI pay commission in terms of HO circular No 10/02/2011-
EIII/A dated 19.03.2012 on adhoc basis.
Note 86
In IGM Noida, the unit had retained an amount of ` 542.96 lacs on account of imposition
�!� '�Q�������*(���;�����;�''�<��""��"�����!��� �����'�����������!� �����*"����authority.
Note 87
S������"��"�����!��'���"�*��$���*"������!�''�;��(������'����$��"��������*"�����(�from March to February as followed in erstwhile government regime and tax is deducted
accordingly.
124
Note 88
In SPM the over time policy is as per Factories Act, 1948. However, on some occasions
�=���*��������;���������"���!�������C������(����*C�*�*�'�*���C�����"���S�������Act, 1948.
Note 89
In ISP Unpaid Land Revenue Taxes for the past several years: An amount estimated
at ` 235 lacs (approximately) towards land revenue taxes upto 31.03.2011 has not
been settled. Although an adhoc provision of ` 210.00 lacs has been made in the year
2009-10, the management does not forsee any further liability.
As per our report of even date annexed.
For M/s SERVA ASSOCIATES On behalf of Security Printing and Minting
CHARTERED ACCOUNTANTS Corporation of India Ltd.
Firm Registration No. 000272N
Sd/- Sd/- Sd/-
CA. AMARJIT VERMA M.S. Rana Ashwini Kumar
(M.No 083520) Chairman & Managing Director Director (Technical)
Partner & Incharge Director (Finance)
Sd/-
Date: 30.07.2012 Sachin Agarwal
Place: New Delhi (Asstt Company Secretary)