Home  »  Company  »  Godavari Drugs  »  Quotes  »  Accounting Policy
Enter the first few characters of Company and click 'Go'

Accounting Policies of Godavari Drugs Ltd. Company

Mar 31, 2015

1.1 ACCOUNTING CONCEPTS

The company follows mercantile system of Accounting and recognizes Income and Expenditure on accrual basis. Accounting Policies not otherwise referred to consistent with generally accepted principles.

1.2 REVENUE RECOGNITION

a) Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership are transferred to the customer.

b) Interest income is accounted as per contractual terms entered into with the parties concerned.

1.3 TURNOVER

Turnover comprises sale of goods, raw materials and contract manufacturing charges.

1.4 FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

1.5 DEPRECIATION:

We hereby certify that depreciation on Plant and Machinery, Factory Building, Electrical Installation and Lab Equipments has been charged as per the rates and manner specified in Schedule II of the Companies Act 2013 and on Furniture and Fixtures, Vehicles, Office Equipment and Computers on WDV.

The following factors have also been considered while charging the depreciation:

I. Depreciation has been provided on the basis of SLM method as per the rate in Schedule II of Companies Act 2013.

II. Factory Plant as continuous process plant based on the technical considerations involved.

1.6 INVENTORIES

Raw materials, Trading goods, Work-in-process and finished goods are valued at the lower of cost or net realizable value.

Cost of raw materials, packing materials, trading goods and stores, spares is determined on first - in first - out basis. Cost of work-in-process includes cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

1.7 BORROWING COSTS

Borrowing costs that are attributable to acquisition of machinery or construction of buildings are capitalized as part of such assets for the period up to the date such assets are put to use. All other borrowing costs are charged to revenue.

1.8 RESEARCH AND DEVELOPMENT

(i) Equipment purchased for research and development is capitalised when commissioned and included in the gross block of fixed assets

(ii) Research and Development expenditure incurred are charged to Profit & Loss account of the year under relevant head of Account.

(iii) Research and Development expenditure incurred on identified products on or before 31st March 2003, the benefit of which is expected to accrue to the company over period of time will be written off in five years from the production/launch of the product.

1.9 GOVERNMENT GRANTS

Grants in the form of capital/investment subsidy are treated as capital reserve.

1.10 FOREIGN EXCHANGE TRANSACTIONS

Revenue from overseas clients and collections are recorded at the exchange rate as of the date of the respective transactions. Expenditure in foreign currency is accounted at the exchange rate prevalent when such expenditure is incurred. Monetary Assets and Liabilities denominated in foreign currency as at the Balance Sheet date not covered by foreign exchange contracts are translated at year-end rates. The resultant exchange differences are recognized in the Profit & Loss account.

1.11 EMPLOYEE BENEFITS

a) Short term employee benefits

Undiscounted value of short term employee benefits such as salaries, wages, short term compensated absences bonus, exgratia and performance incentives are recognized as expense in the period in which the employees render the related service.

b) Post employment Benefits

Defined contribution plans

Contribution to refined contribution plans being Employee Provident Fund, Employee State Insurance, Employee Pension Schemes, Labour Welfare Fund, Employee Insurance Scheme and Super Annuation Fund are recognized in the statement of Profit and Loss during the period in which the employees render the related services.

Defined Benefit Plans

Liabilities in respect of defined benefit plans being Gratuity and Leave encashment are determined based on an actuarial valuation using the projected unit cost method. Actuarial gains or losses are recognized immediately in the statement of profit and loss

1.12 InvestmentInvestments are classified into current and long-term investments. Current Investments are stated at the lower of cost and fair value. Long term investments are stated at cost. However, provision for diminution is made to recognize a decline, other than temporary, in the value of long-term investments.

1.13 TAXES ON INCOME

Tax on Income for the current year is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act 1961.

Deferred tax assets and liabilities are accounted for based on the difference between taxable income and accounting income that originate in one period and reasonably expected to reverse in the subsequent periods.

Deferred tax assets arising from timing differences are recognised to the extent, there is reasonable certainty that these would be realised in future.

1.14 SEGMENT REPORTING

The Company''s operations mainly comprises manufacting of bulk drugs and Contract manufacturing. These activities constitute the primary segment.

1.15 EARNINGS PER SHARE

Basic Earnings per Share is calculated by dividing the net profit or loss for the period attributable to equity share holders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.16 IMPAIRMENT OF ASSETS

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such an indication exists, then the carrying value is reduced to the higher of the net selling price or the value in use. The value in use is the present value of estimated future net income expected from use of the asset.

1.17 CONTINGENT LIABILITIES:

We hereby certify that the amount of Contingent liabilities as noted in the Balance Sheet as on 31st March, 2015 is adequate.

We hereby certify that there are no liabilities contingent or otherwise as on 31st March, 2015 which have not been considered in the accounts of the Company for the year ended on that date, and there are no tax or other claims for litigation pending against the Company which have financial implementation other than those shown as such in the Balance Sheet.

The Company is having one class of Equity Shares of face value Rs.10 per share. Each holder of Equity share is entitled to one vote per share.

The Number of shares at the beginning and the end are the same.There are no fresh issue of shares or forfeiture during the current year and in the previous year.


Mar 31, 2014

1.1 ACCOUNTING CONCEPTS

The company follows mercantile system of Accounting and recognizes Income and Expenditure on accrual basis. Accounting Policies not otherwise referred to consistent with generally accepted principles.

1.2 REVENUE RECOGNITION

a) Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership are transferred to the customer.

b) Interest income is accounted as per contractual terms entered into with the parties concerned.

1.3 TURNOVER

Turnover comprises sale of goods, raw materials and contract manufacturing charges.

1.4 FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

1.5 DEPRECIATION

Depreciation on Plant & Machinery, Factory Building, Electrical Installations and Laboratory Equipment is provided on straight line method, while in case of Furniture and Fixtures, Vehicles, Office Equipment and Computers is provided on written down value method as per the rates prescribed in schedule XIV of the Companies Act, 1956 as amended and rules framed there under.

1.6 INVENTORIES

Raw materials,Trading goods, Work-in-process and finished goods are valued at the lower of cost or net realizable value.

Cost of raw materials, packing materials, trading goods and stores, spares is determined on first -in first - out basis. Cost of work-in-process includes cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

1.7 BORROWING COSTS

Borrowing costs that are attributable to acquisition of machinery or construction of buildings are capitalized as part of such assets for the period up to the date such assets are put to use. All other borrowing costs are charged to revenue.

1.8 RESEARCH AND DEVELOPMENT

(i) Equipment purchased for research and development is capitalised when commissioned and included in the gross block of fixed assets

(ii) Research and Development expenditure incurred are charged to Profit & Loss account of the year under relevant head of Account.

(iii) Research and Development expenditure incurred on identified products on or before 31 st March 2003, the benefit of which is expected to accrue to the company over period of time will be written off in five years from the production/launch of the product.

1.9 GOVERNMENT GRANTS

Grants in the form of capital/investment subsidy are treated as capital reserve.

1.10 FOREIGN EXCHANGE TRANSACTIONS

Revenue from overseas clients and collections are recorded at the exchange rate as of the date of the respective transactions. Expenditure in foreign currency is accounted at the exchange rate prevalent when such expenditure is incurred. Monetary Assets and Liabilities denominated in foreign currency as at the Balance Sheet date not covered by foreign exchange contracts are translated at year-end rates. The resultant exchange differences are recognized in the Profit & Loss account.

1.11 EMPLOYEE BENEFITS

a Short term employee benefits

Undiscounted value of short term employee benefits such as salaries, wages, short term compensated absences bonus, exgratia and performance incentives are recognized as expense in the period in which the employees render the related service.

b Post employment Benefits

Defined contribution plans

Contribution to refined contribution plans being Employee Provident Fund, Employee State Insurance, Employee Pension Schemes, Labour Welfare Fund, Employee Insurance Scheme and Super Annuation Fund are recognized in the statement of Profit and Loss during the period in which the employees render the related services. Defined Benefit Plans

Liabilities in respect of defined benefit plans being Gratuity and Leave encashment are determined based on an actuarial valuation using the projected unit cost method. Actuarial gains or losses are recognized immediately in the statement of profit and loss

1.12 Investment

Investments are classified into current and long-term investments. Current Investments are stated at the lower of cost and fair value. Long term investments are stated at cost. However, provision for diminution is made to recognize a decline, other than temporary, in the value of long-term investments.

1.13 TAXES ON INCOME

Tax on Income for the current year is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act 1961.

Deferred tax assets and liabilities are accounted for based on the difference between taxable income and accounting income that originate in one period and reasonably expected to reverse in the subsequent periods.

Deferred tax assets arising from timing differences are recognised to the extent, there is reasonable certainty that these would be realised in future.

1.14 SEGMENT REPORTING

The Company''s operations mainly comprises manufacting of bulk drugs and Contract manufacturing. These activities constitute the primary segment.

1.15 EARNINGS PER SHARE

Basic Earnings per Share is calculated by dividing the net profit or loss for the, period attributable to equity share holders by the weighted average number of equity shares outstanding during the period. For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.16 IMPAIRMENT OF ASSETS

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such an indication exists, then the carrying value is reduced to the higher of the net selling price or the value in use. The value in use is the present value of estimated future net income expected from use of the asset.

1.17 PROVISIONS/CONTINGENT LIABILITIES

Provisions are recognised, when the Company has a present legal or constructive obligation, as a result of past events, for which is probable that an out flow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation. The disclosure is made for all present or possible obligations that may but probably will not require outflow as contingent liability in the financial statements.


Mar 31, 2013

1.1 ACCOUNTING CONCEPTS

The company follows mercantile system of Accounting and recognizes Income and Expenditure on accrual basis. Accounting Policies not otherwise referred to consistent with generally accepted principles.

1.2 REVENUE RECOGNITION

a) Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership are transferred to the customer.

b) Interest income is accounted as per contractual terms entered into with the parties concerned.

1.3 TURNOVER

Turnover comprises sale of goods and contract manufacturing charges.

1.4 FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

1.5 DEPRECIATION

Depreciation on Plant & Machinery, Factory Building, Electrical Installations and Laboratory Equipment is provided on straight line method, while in case of Furniture and Fixtures, Vehicles, Office Equipment and Computers is provided on written down value method as per the rates prescribed in schedule XIV of the Companies Act, 1956 as amended and rules framed there under.

1.6 INVENTORIES

Raw materials, Trading goods, Work-in-process and finished goods are valued at the lower of cost or net realizable value.

Cost of raw materials, packing materials, trading goods and stores, spares is determined on first -in first - out basis. Cost of work-in-process includes cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

1.7 BORROWING COSTS

Borrowing costs that are attributable to acquisition of machinery or construction of buildings are capitalized as part of such assets for the period up to the date such assets are put to use. All other borrowing costs are charged to revenue.

1.8 RESEARCH AND DEVELOPMENT

(i) Equipment purchased for research and development is capitalized when commissioned and included in the gross block of fixed assets

(ii) Research and Development expenditure incurred are charged to Profit & Loss account of the year under relevant head of Account.

(iii) Research and Development expenditure incurred on identified products on or before 31st March 2003, the benefit of which is expected to accrue to the company over period of time will be written off in five years from the production/launch of the product.

1.9 GOVERNMENT GRANTS

Grants in the form of capital/investment subsidy are treated as capital reserve.

1.10 FOREIGN EXCHANGE TRANSACTIONS

Revenue from overseas clients and collections are recorded at the exchange rate as of the date of the respective transactions. Expenditure in foreign currency is accounted at the exchange rate prevalent when such expenditure is incurred. Monetary Assets and Liabilities

denominated in foreign currency as at the Balance Sheet date not covered by foreign exchange contracts are translated at year-end rates. The resultant exchange differences are recognized in the Profit & Loss account.

1.11 EMPLOYEE BENEFITS

a. Short term employee benefits

Undiscounted value of short term employee benefits such as salaries, wages, short term compensated absences bonus, exgratia and performance incentives are recognized as expense in the period in which the employees render the related service.

b. Post employment Benefits Defined contribution plans

Contribution to refined contribution plans being Employee Provident Fund, Employee State Insurance, Employee Pension Schemes, Labour Welfare Fund, Employee Insurance Scheme and Super Annuation Fund are recognized in the statement of Profit and Loss during the period in which the employees render the related services.

Defined Benefit Plans

Liabilities in respect of defined benefit plans being Gratuity and Leave encashment are determined based on an actuarial valuation using the projected unit cost method. Actuarial gains or losses are recognized immediately in the statement of profit and loss

1.12 Investment

Investments are classified into current and long-term investments. Current Investments are stated at the lower of cost and fair value. Long term investments are stated at cost. However, provision for diminution is made to recognize a decline, other than temporary, in the value of long-term investments.

1.13 TAXES ON INCOME

Tax on Income for the current year is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act 1961.

Deferred tax assets and liabilities are accounted for based on the difference between taxable income and accounting income that originate in one period and reasonably expected to reverse in the subsequent periods.

Deferred tax assets arising from timing differences are recognized to the extent, there is reasonable certainty that these would be realized in future.

1.14 SEGMENT REPORTING

The Company''s operations mainly comprises manifesting of bulk drugs and Contract manufacturing. These activities constitute the primary segment.

1.15 EARNINGS PER SHARE

Basic Earnings per Share is calculated by dividing the net profit or loss for the period attributable to equity share holders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.16 IMPAIRMENT OF ASSETS

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such an indication exists, then the carrying value is reduced to the higher of the net selling price or the value in use. The value in use is the present value of estimated future net income expected from use of the asset. ,

1.17 PROVISIONS/CONTINGENT LIABILITIES

Provisions are recognized, when the Company has a present legal or constructive obligation, as a result of past events, for which is probable that an out flow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation. The disclosure is made for all present or possible obligations that may but probably will not require outflow as contingent liability in the financial statements.


Mar 31, 2012

1.1 ACCOUNTING CONCEPTS

The company follows mercantile system of Accounting and recognizes Income and Expenditure on accrual basis. Accounting Policies not otherwise referred to consistent with generally accepted principles.

1.2 REVENUE RECOGNITION

a) Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership are transferred to the customer.

b) Interest income is accounted as per contractual terms entered into with the parties concerned.

1.3 TURNOVER

Turnover comprises sale'of goods and contract manufacturing charges.

1.4 FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

1.5 DEPRECIATION

Depreciation on Plant & Machinery, Factory Building, Electrical Installations and Laboratory Equipment is provided on straight iine method, while in case of Furniture and Fixtures, Vehicles, Office Equipment and Computers is provided on written down value method as per the rates prescribed in schedule XIV of the Companies Act, 1956 as amended and rules framed there under.

1.6 INVENTORIES

Raw materials,Trading goods, Work-in-process and finished goods are valued at the lower of cost or net realizable value.

Cost of raw materials, packing materials, trading goods and stores, spares is determined on first -in first - out basis. Cost of work-in- process includes cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

1.7 BORROWING COSTS

Borrowing costs that are attributable to acquisition of machinery or construction of buildings are capitalized as part of such assets for the period up to the date such assets are put to use. All other borrowing costs are charged to revenue.

1.8 RESEARCH AND DEVELOPMENT

(i) Equipment purchased for research and development is capitalised when commissioned and included in the gross block of fixed assets

(ii) Research and Development expenditure incurred are charged to Profit & Loss account of the year under relevant head of Account.

(iii) Research and Development expenditure incurred on identified products on or before 31" March 2003, the benefit of which is expected to accrue to the company over period of time will be written off in five years from the production/launch of the product.

1.9 GOVERNMENT GRANTS

Grants in the form of capital/investment subsidy are treated as capital reserve.

1.10 FOREIGN EXCHANGE TRANSACTIONS

Revenue from overseas clients and collections are recorded at the exchange rate as of the date of the respective transactions. Expenditure in foreign currency is accounted at the exchange rate prevalent when such expenditure is incurred. Monetary Assets and Liabilities denominated in foreign currency as at the Balance Sheet date not covered by foreign exchange contracts are translated at year-end rates. The resultant exchange differences are recognized in the Profit & Loss account.

1.11 EMPLOYEE BENEFITS

a Short term employee benefits

Undiscounted value of short term employee benefits such as salaries, wages, short term compensated absences bonus, exgratia and performance incentives are recognized as expense in the period in which the employees render the related service, b Post employment Benefits Defined contribution plans

Contribution to refined contribution plans being Employee Provident Fund, Employee State Insurance, Employee Pension Schemes,Labour Welfare Fund Employee Insurance Scheme and Super Annuation Fund are recognized in the statement of Profit and Loss during the period in which the employees render the related services.

Defined Benefit Plans

Liabilities in respect of defined benefit plans being Gratuity and Leave encashment are determined based on an actuarial valuation using the projected unit cost method. Actuarial gains or losses are recognized immediately in the statement of profit and loss.

1.12 TAXES ON INCOME

Tax on Income for the current year is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act 1961.

Deferred tax assets and liabilities are accounted for based on the difference between taxable income and accounting income that originate in one period and reasonably expected to reverse in the subsequent periods.

Deferred tax assets arising from timing differences are recognised to the extent, there is reasonable certainty that these would be realised in future.

1.T3 SEGMENT REPORTING -

The Company's operations mainly comprises manufacting of bulk drugs and Contract manufacturing. These activities constitute the primary segment.

1.14 EARNINGS PER SHARE

Basic Earnings Per Share is calculated by dividing the net profit or loss for the period attributable to equity share holders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable to equity share holders and the weighted average number o£ shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

1.15 IMPAIRMENT OF ASSETS

The carrying amounts of assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such an indication exists, then the carrying value is reduced to the higher of the net selling price or the value in use. The value in use is the present value of estimated future net income expected from use of the asset.

1.16 PROVISIONS/CONTINGENT LIABILITIES

Provisions are recognised, when the Company has a present legal or constructive obligation, as a result of past events, for which is probable that an but flow of economic benefits will be required to settle the obligation and a reliable estimate can be made for the amount of the obligation. The disclosure is made for all present or possible obligations that may but probably will not require outflow as contingent liability in the financial statements.


Mar 31, 2010

ACCOUNTING CONCEPTS

The company follows mercantile system of Accounting and recognizes income and Expenditure on accrual basis. Accounting Policies not otherwise referred are consistent with generally accepted principles.

REVENUE RECOGNITION

a) Revenue from sale of goods is recognized when significant risks and rewards in respect of ownership are transferred to the customer.

b) Interest income is accounted as per contractual terms entered into with the parties concerned.

TURNOVER

Turnover comprises sale of goods and contract manufacturing charges.

FIXED ASSETS

Fixed Assets are stated at cost less depreciation.

DEPRECIATION

Depreciation on Plant & Machinery, Factory Building, Electrical Installation and Laboratory Equipments is provided on straight line method while in case of Furniture and Fixtures, Vehicles, Office Equipment and Computers on written down value method as per the rates prescribed in schedule XIV of the Companies Act, 1956 as amended and rules framed there under.

INVENTORIES

Raw materials, Trading goods, Work-in-process and finished goods are valued at the lower of cost and net realizable value.

Cost of raw materials, packing materials, trading goods and stores, spares is determined on first -in first - out basis. Cost of work-in-process includes cost of conversion and other costs incurred in bringing the inventories to their present location and condition,

BORROWING COSTS

Borrowing costs that are attributable to acquisition or construction of fixed assets are capitalised as part of such assets for the period up to the date of commencement of production. All other borrowing costs are charged to revenue.

RESEARCH AND DEVELOPMENT

(i) Equipment purchased for research and development is capitalised when commissioned and included in the gross block of fixed assets

(ii) Research and Development expenditure incurred are charged to Profit & Loss account of the year under relevant head of accounts.

(iii) Research and Development expenditure incurred on identified products on or before 31st March 2003, the benefit of which is expected to accrue to the company over period of time will be written off in five years from the production/launch of the product.

GOVERNMENT GRANTS

Grants in the form of capital/investment subsidy are treated as capital reserve.

FOREIGN EXCHANGE TRANSACTIONS

Revenue from overseas clients and collections are recorded at the exchange rate as of the date of the respective transactions. Expenditure in foreign currency is accounted at the exchange rate prevalent when such expenditure is incurred. Monetary Assets and Liabilities denominated in foreign currency as at the Balance Sheet date not covered by foreign exchange contracts are translated at year-end rates. The resultant exchange differences are recognized in the Profit & Loss account.

RETIREMENT BENEFITS

Accrued liability for retirement benefits (Gratuity) is calculated based on the assumption that these benefits are payable to all employees at the end of the accounting year.

Contributions to defined schemes such as Provident Fund, Employees State Insurance Scheme and Provision for Bonus are accounted for on accrual basis. TAXES ON INCOME

Tax on Income for the current year is determined on the basis of taxable income and tax credits computed in accordance with the provisions of the Income Tax Act 1961.

Deferred tax assets and liabilities are accounted for based on the difference between taxable income and accounting income that originate in one period and reasonably expected to reverse in the subsequent periods.

Deferred tax assets arising from timing differences are recognised to the extent there is reasonable certainty that these would be realised in future.

EMPLOYEE BENEFITS

a. Short term employee benefits:

Undiscounted value of short term employee benefits such as salaries, wages, bonus and exgratia are recognised as expense in the period in which the employee renders the related service.

b. Post Employee Benefits

Defined contribution Plans:

Contribution to defined contribution plans being employee Provident Fund, Employee state insurance and Employee Pension schemes are recognized in the profit and loss account during the period in which the employee renders the related service.

Defined Benefit Plans:

Liabilities in respect of defined benefit plans being Gratuity and Leave encashment are determined based on an actuarial valuation using the projected unit credit method. Actuarial gains or losses are recognised immediately in the profit and loss account.

 
Subscribe now to get personal finance updates in your inbox!