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Notes to Accounts of Kovai Medical Center and Hospital Ltd.

Mar 31, 2015

1. In-patients and out patients revenue is net of discount/free/concessional treatment/claims.

2. Contingent Liabilities and Commitments as on closing date

Rs,in lacs)

Particulars 31.03.2015 31.03.2014

Contingent Liabilities:

a) Letters of Credit for capital equipment's 152.38 315.00

b) Demand of Customs Duty (excluding interest) raised by 189.46 189.46 the authorities disputed and not acknowledged

c) Claims of various nature made against the Company not 709.20 119.20 acknowledged as debt

Commitments: Estimated amount of contracts remaining to be executed on capital account 929.83 5,014.18

3. Segment Reporting

Running of Hospitals is the only operating segment for the company. The entire financials and profit given are related only to this segment.

4. Depreciation is provided on Straight Line Method based on the useful life as specified in Schedule II of the Companies Act, 2013. In respect of assets whose remaining useful life is already exhausted as at April 1, 2014, depreciation of Rs. 55.78 lacs (net of deferred tax) has been adjusted against the opening balance of Retained Earnings as on that date. Consequent to the above, depreciation for the year is higher by Rs. 506.17 lacs.

5. Income tax assessments have been completed upto the assessment year 2012-13.

6. Figures of the previous year have been regrouped, reclassified and rearranged wherever necessary to conform to current year's classification.

7. Figures have been rounded off to the nearest thousands.


Mar 31, 2014

Not Available


Mar 31, 2013

1. Operating Lease

The Company has entered into operating lease, having a lease period ranging from 1-5 years, with an option to renew the lease.

2. The Company has provided for employee benefits as per Accounting Standard (AS) -15 in respect of defined benefit plan (Gratuity and Long Term compensated absence).

a) Description of the company''s defined benefit plan:

The Company operates a defined benefit plan for payment of post employment benefits in the form of Gratuity and Long Term compensated absence. Benefits under the plan are based on pay and years of service and are vested on completion of five years of service, as provided for in the Payment of Gratuity Act, 1972. The terms of the benefits are common for all the employees of the company.

3. In-patients and out patients revenue is net of discount/free/concessional treatment/claims.

4. Contingent Liabilities (Rs.in lacs)

Particulars 31.03.2013 31.03.2012

a. Estimated amount of contracts remaining to 270.05 141.43 be executed on capital account

b. Letters of Credit for capital equipments Nil 67.14

c. Demand of Customs Duty raised by the authorities disputed and not acknowledged 189.46 189.46 as due

d. Claims of various nature made against the Company not acknowledged as debt 117.58 87.86

5. Related parties'' disclosure under Accounting Standard (AS) -18.

The list of related parties as identified by the management are as under (i) Names of related parties and description of relationship :

a. Key Management Personnel Dr. Nalla G Palaniswami

- Promoters Dr. Thavamani Devi Palaniswami

b. Subsidiary Company Idhayam Hospitals Erode Ltd

c. Other Related Parties Entities in which the Directors are interested

Purani Hospital Supplies Limited

Aosta Software Technologies India Ltd

ABT Industries Limited

Sakthi Sugars Limited

K Pharmacy

NGP Estate Motors Agencies

Dr. K.S.K. Murugaiyan

Mrs.P. Vikashini

(ii) Related Party Transactions:

The Company has identified all related parties and details of transactions are given below. No provision for doubtful debts or advances is required to be made and no amounts have been written off or written back during the year in respect of debts due from or to related parties. There are no other related parties where control exists that need to be disclosed. Following transactions were carried out with the related parties.

6. Segment Reporting

Running of Hospitals is the only operating segment for the company. The entire financials and profit given are related only to this segment.

7. Provision for taxation includes provision for Wealth Tax. Income tax assessments have been provisionally completed upto the assessment year 2011-12.

8. Figures of the previous year have been regrouped, reclassified and rearranged wherever necessary to conform to current year''s classification.

9. Figures have been rounded off to the nearest thousands.


Mar 31, 2012

1. Security Particulars of Secured Loans

i. The term loans availed from Indian Bank and Indian Overseas Bank are primarily secured by:

(a) Paripasu Charge on the Land and appurtenances therewith located at Kalapatti Village at Coimbatore and land located at Erode.

(b) Paripasu Charge on the entire fixed assets (Present & Future) of the company.

(c) Charge on the leasehold rights of the building at Erode in the name of M/s Idhayam Hospitals Erode Limited, Erode.

(d) Charge on the leasehold rights of the medical equipments in the name of M/s Idhayam Hospitals Erode Limited, Erode.

The above facilities are also collaterally secured by stock and book debts of the Company.

ii. In addition to the above, the subsidiary company has given corporate guarantee to the limits availed by the company.

iii. The term loans and working capital facilities are further guaranteed by the personal guarantees of the Chairman and Managing Director and Vice Chairman and Joint Managing Director of the Company.

iv. Secured loans from others represents Hire Purchase loans from BMW India Financial Services Private Ltd & SREI Equipments Finance Pvt Ltd secured by hypothecation of assets purchased.

1. The Company has provided for employee benefits as per Accounting Standard 15 in respect of defined benefit plan (Gratuity and Long Term compensated absence).

(a) Description of the company's defined benefit plan:

The Company operates a defined benefit plan for payment of post employment benefits in the form of Gratuity and Long Term compensated absence. Benefits under the plan are based on pay and years of service and are vested on completion of five years of service, as provided for in the Payment of Gratuity Act, 1972. The terms of the benefits are common for all the employees of the company.

2. In-patients and out patients revenue is net of discount/free/concessional Treatment/claims.

3. Contingent Liabilities: (Rs in lacs)

As at As at 31.3.2012 31.3.2011

(a) Estimated amount of contracts remaining to 141.43 772.12 be executed on capital account

(b) Letters of Credit for capital equipment's 67.14 163.88

(c) Demand of Customs Duty raised by the authorities disputed and not acknowledged 189.46 189.46 as due

(d) Claims of various nature made against the Company not acknowledged as debt 87.86 93.71

4. Segment Reporting

Running of Hospitals is the only operating segment for the company. The entire financials and profit given are related only to this segment.

5. Provision for taxation includes provision for Wealth Tax. Income tax assessments have been provisionally completed upto the assessment year 2010-11.

6. Previous As notified by ministry of corporate affairs, revised schedule VI under the companies act, 1956 is applicable to the financial statement for the financial year commencing on or after 1st April 2011 .Accordingly, the financial statement for the year ended 31st March 2012 is prepared in accordance with the revised schedule VI. The amount and disclosures included in the financial statement of the previous year have been reclassified to conform to the requirement of revised schedule VI.

7. Figures have been rounded off to the nearest thousands.


Mar 31, 2011

1. Security Particulars of Secured Loans

I. The term loans availed from Indian Bank and Indian Overseas Bank are primarily secured by:

a. Paripasu Charge on the Land and appurtenances therewith located at Kalapatti Village at Coimbatore and land located at Erode.

b. Paripasu Charge on the entire fixed assets ( Present & Future ) of the company.

c. Charge on the leasehold rights of the building at Erode in the name of M/s Idhayam Hospitals Erode Limited, Erode.

d. Charge on the leasehold rights of the medical equipments in the name of M/s Idhayam Hospitals Erode Limited, Erode.

The above facilities are also collaterally secured by stock and book debts of the Company.

II. The Company has availed working capital facility from Indian Bank which is primarily secured by:

a. Paripasu second charge on current assets by way hypothecation of present & future current assets including book debts & receivables.

b. The above working capital facility is collaterally secured by all fixed assets mentioned in item No.1 (I) (a) to (d) above.

III. In addition to the above, the subsidiary company has given corporate guarantee to the limits availed by the company.

IV. The term loans and working capital facilities are further guaranteed by the personal guarantees of the Chairman and Managing Director and Vice Chairman and Joint Managing Director of the Company.

2. Secured and Unsecured Loans include an amount of Rs. 1276.48 Lacs repayable within a period of one year.

3. Deposit with Banks and others include:

I. Rs. 4,000/- under lien to Sales Tax authorities towards sales tax deposit and

ii. Rs. 2,21,254/-under lien to Indian Bank towards margin for outstanding Letters of Credit. (Previous Year Rs. 41,91,454)

4. Loans & Advances includes Rs. 500 lacs of Lease Advance receivable from the Subsidiary Company (Lessor).

5. Quantitative Particulars in respect of operations and inventories in accordance with the requirements of schedule VI to the Companies Act, 1956 have not been furnished in view of the practical difficulties relating to this specific industry.

6. The company has initiated the process of obtaining confirmation from suppliers who have registered themselves under the "Micro, Small and Medium Enterprises Act, 2006". Based on the evidence and declarations obtained, there are no dues warranting interest payment under the "Micro, Small and Medium Enterprises Act, 2006".

7. The Company has provided for employee benefits as per Accounting Standard 15 in respect of defined benefit plan (Gratuity and Long Term compensated absence).

a) Description of the company's defined benefit plan:

The Company operates a defined benefit plan for payment of post employment benefits in the form of Gratuity and Long Term compensated absence. Benefits under the plan are based on pay and years of service and are vested on completion of five years of service, as provided for in the Payment of Gratuity Act, 1972. The terms of the benefits are common for all the employees of the company.

8. In-patients and out patients revenue is net of discount / free / concessional treatment / claims.

9. The title of a piece of land belonging to the Company admeasuring 5000 Sq.ft is challenged legally by a third party which the Company is defending

10. Contingent Liabilities: (Rs.in Lacs)

As at 31.3.2011 As at 31.3.2010

a) Estimated amount of contracts remaining to 772.12 3718.20 be executed on capital account

b) Letters of Credit for capital equipments 163.88 1868.92

c) Demand of Customs Duty raised by the authorities disputed and not acknowledged 189.46 189.46 as due

d) Claims of various nature made against the Company not acknowledged as debt 93.71 99.21

11. Related parties disclosure under Accounting standard (AS) - 18. The list of related parties as identified by the management are as under

(i) Names of related parties and description of relationship

a. Key Management Personnel : 1. Dr.Nalla G Palaniswami

-Promoters 2. Dr.Thavamani Devi Palaniswami

b. Subsidiary Company Idhayam Hospitals Erode Ltd.

c. Other Related Parties Entities in which the Directors are interested

: Purani Hospitals Supplies Limited.

: Aosta Software Technologies India Limited.

: ABT Industries Limited.

: Sakthi Sugars Limited.

: K Pharmacy

: NGP Estate motors Agencies

: Dr.Murugaiyan.K.S.K.

: Miss.P.Vikashine

(ii) Related Party Transactions :

The Company has identified all related parties and details of transactions are given below. No provision for doubtful debts or advances is required to be made and no amounts have been written off or written back during the year in respect of debts due from or to related parties. There are no other related parties where control exists that need to be disclosed. Following transactions were carried out with the related parties.

12. Segment Reporting

Running of Hospitals is the only operating segment for the company.The entire financials and profit given are related only to this segment.

13. Provision for taxation includes provision for Wealth Tax . Income tax assessments have been provisionally completed upto the assessment year 2008-09.

14. Borrowing cost capitalized during the year Rs. 4,99,93,930/-

15. Figures of the previous year have been regrouped, reclassified and rearranged wherever necessary to conform to current year's classification.

16. Figures have been rounded off to the nearest thousands.


Mar 31, 2010

1. Security Particulars of Secured Loans

I. The term loans availed from Indian Bank and Indian Overseas Bank are primarily secured by:

a. Charge on the immovable properties of the company situated at Kalapatti Village at Coimbatore and Erode.

b. Charge on the movable fixed assets including medical equipments.

c. Charge on the leasehold rights of the building at Erode in the name of M/s Idhayam Hospitals Erode Limited, Erode.

d. Charge on the leasehold rights of the medical equipments in the name of M/s Idhayam Hospitals Erode Limited, Erode.

The above facilities are also collaterally secured by stock and book debts of the Company.

II. The Company has availed working capital facility from Indian Bank which is primarily secured by:

a. Hypothecation of stocks, book debts and other current assets.

b. The above working capital facility is collaterally secured by all fixed assets mentioned in item No.1 I (a) to (d) above.

III. In addition to the above, the subsidiary company has given corporate guarantee to the limits availed by the company.

IV. The term loans and working capital facilities are further guaranteed by the personal guarantees of the Chairman and Managing Director and Vice Chairman and Joint Managing Director of the Company.

2. Deposits with Bank and other include:

a) Rs. 4,000/- under lien to Sales Tax authorities towards sales tax deposit and

b) Rs.41,91,454/- under lien to Indian Bank towards margin for outstanding Letters of Credit and Bank Guarantee. (Previous Year Rs. 35,56,454/-)

c) Rs. 5,43,425/-under lien to Indian Overseas Bank towards margin for Bank Guarantee.

3. Quantitative Particulars in respect of operations and inventories in accordance with the requirements of schedule VI to the Companies Act, 1956 have not been furnished in view of the practical difficulties relating to this specific industry.

4. The company has initiated the process of obtaining confirmation from suppliers who have registered themselves under the "Micro, Small and Medium Enterprises Act, 2006". Based on the evidence and declarations obtained, there are no dues warranting interest payment under the "Micro, Small and Medium Enterprises Act, 2006".

5. The Company has provided for employee benefits as per Accounting Standard 15 in respect of defined benefit plan (Gratuity and Long Term compensated absence).

a) Description of the companys defined benefit plan:

The Company operates a defined benefit plan for payment of post employment benefits in the form of Gratuity and Long Term compensated absence. Benefits under the plan are based on pay and years of service and are vested on completion of five years of service, as provided for in the Payment of Gratuity Act, 1972. The terms of the benefits are common for all the employees of the company.

6. The Ministry of Corporate Affairs through its notification dated 31.03.09 has relaxed the provisions of Accounting Standard 11 "The Effects of changes in Foreign Exchange Rates" for treating the exchange gain / loss arising on restatement of Long Term Foreign currency monetary items. Accordingly, companies are permitted to adjust the carrying cost of depreciable assets by the exchange differences arising out of exchange rate fluctuation. The company has exercised the option provided in the said notification and consequently an amount of Rs. 12,86,558/- representing exchange gain has been adjusted in the cost of the asset during the year. The adjusted cost has been considered for depreciation purposes.

7. In-patients and out patients revenue is net of discount / free / concessional treatment / claims.

8. a) The legality of the title of a land belonging to the Company, admeasuring 6.44 acres, which was challenged legally, has been adjudicated in favour of the Company by the Honourable Madras High Court. Thus the title of the said land is clear and marketable.

b) The title of a piece of land belonging to the Company admeasuring 5000 sq.ft. is challenged legally by a third party which the company is defending.

9. Contingent Liabilities: (Rs.in Lacs)

As at 31.3.2010 As at 31.3.2009

a) Estimated amount of contracts remaining to 3718.20 2976.34 be executed on capital account

b) Letters of Credit for capital equipments 1868.92 25.81

c) Demand of Customs Duty raised by the

authorities disputed and not acknowledged 11.49 11.49

as due

d) Claims of various nature made against the

Company not acknowledged as debt 99.21 150.00

10. Related parties disclosure under Accounting Standard (AS) -18.

The list of related parties as identified by the management are as under (i) Names of related parties and description of relationship

a. Key Management Personnel 1.Dr. NallaGPalaniswami

2. Dr. Thavamani Devi Palaniswami

b. Subsidiary Company Idhayam Hospitals Erode Ltd.

c. Other Related Parties Purani Hospital Supplies Limited. Entities in which the Aosta Software Technologies India Limited. Directors are interested ABT Industries Limited.

Sakthi Sugars Limited.

K Pharmacy

NGP Estate motors Agencies

Dr. K.S.K. Murugaiyan

(ii) Related Party Transactions:

The Company has identified all related parties and details of transactions are given below. No provision for doubtful debts or advances is required to be made and no amounts have been written off or written back during the year in respect of debts due from or to related parties. There are no other related parties where control exists that need to be disclosed. Following transactions were carried out with the related parties.

11. Figures of the previous year have been regrouped, reclassified and rearranged wherever necessary to confirm to current years classification.

12. Figures have been rounded off to the nearest thousands.

 
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