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Atul Ltd | Annual Report 2017-18
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cr)
Note 16 Other equity
As at
March 31, 2018
As at
March 31, 2017
a) Securities premium reserve
34.66
34.66
b) General reserve
97.36
97.36
c) Retained earnings
Balance as at the beginning of the year
1,426.79
1,156.81
Add: Profit for the year
276.48
322.97
Add: Remeasurement gain | (loss) on defined benefit plans
1.76
1.58
Add: Transfer from OCI on disposal of FVOCI equity instruments
1.59
0.75
Less: Dividend paid (including dividend distribution tax)
(38.51)
(37.02)
Less: Non-controlling interests on acquisition of subsidiary company
(4.60)
(18.30)
Balance as at the end of the year
1,663.51
1,426.79
d) Other reserves
i) FVOCI equity instruments
Balance as at the beginning of the year
364.13
287.52
Add: Equity instruments through Other Comprehensive Income (FVOCI)
37.28
77.36
Less: Transfer to retained earnings on disposal of FVOCI equity
instruments
(1.59)
(0.75)
Balance as at the end of the year
399.82
364.13
ii) Effective portion of cash flows hedges
Balance as at the beginning of the year
(0.48)
(0.59)
Add: Effective portion of gain | (loss) on cash flow hedges
0.05
(0.73)
Add: Deferred tax liability
(0.02)
0.25
Less: Hedging gain | (loss) reclassified to Consolidated Statement of
Profit and Loss
0.48
0.59
Balance as at the end of the year
0.03
(0.48)
iii) Exchange difference in translating the Financial Statements of a
foreign operation
Balance as at the beginning of the year
13.80
9.35
Add: Changes in foreign currency translation reserve
5.06
4.45
Balance as at the end of the year
18.86
13.80
2,214.24
1,936.26
Nature and purpose of other reserves
a) Securities premium reserve
Securities premium reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the
provisions of the Companies Act, 2013.
b) FVOCI – equity instruments
The Group has elected to recognise changes in the fair value of certain investments in equity securities in Other
Comprehensive Income. These changes are accumulated within the FVOCI equity instruments reserve within equity. The
Group transfers amounts from this reserve to retained earnings when the relevant equity securities are derecognised.
c) Cash flow hedging reserve
The Group uses hedging instruments as part of its management of foreign currency risk associated with its highly probable
forecast sale and inventory purchases and interest rate risk associated with variable interest rate borrowings. For hedging
foreign currency risk, the Group uses foreign currency forward contracts, foreign currency option contracts and Interest rate
swaps. They are designated as cash flow hedges to the extent these hedges are effective, the change in fair value of the
hedging instrument is recognised in the cash flow hedging reserve. Amounts recognised in the cash flow hedging reserve is
reclassified to profit or loss when the hedged item affects profit or loss (for example, sales and interest payments). When the
forecast transaction results in the recognition of a non-financial asset (for example, inventory), the amount recognised in the
cash flow hedging reserve is adjusted against the carrying amount of the non-financial asset.
d) Foreign currency translation reserve
Exchange differences arising on translation of the foreign operations are recognised in Other Comprehensive Income as
described in the Accounting Policy and accumulated in a separate reserve within equity. The cumulative amount is reclassified
to profit or loss when the net investment is disposed off.
Notes
to the Consolidated Financial Statements