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Accounting Policies of Lincoln Pharmaceuticals Ltd. Company

Mar 31, 2014

A) Fixed assets

i. Tangible Fixed Assets

Tangible fixed assets are stated at historical cost less accumulated depreciation. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the asset to its working condition for the intended use.

Borrowing costs directly attributable to acquisition or construction of those tangible fixed assets, which necessarily take a substantial period of time to get ready for their intended use, are capitalized.

Advances paid towards acquisition of fixed assets and the cost of assets acquired but not ready for use as at the balance sheet date are disclosed under capital work-in-progress.

ii. Intangible Assets

Intangible fixed assets are stated at historical cost less accumulated amortization. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the assets to its working condition for the intended use. Cost is amortized over its useful economic life based on expected benefit.

b) Depreciation

All tangible fixed assets, except freehold land, leasehold land and capital work in progress, are depreciated on a straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies'' Act, 1956.

c) Impairment:

In accordance with accounting standard 28 on ''Impairment of assets'', the Company assesses at each balance sheet date whether there is an indication that assets of the Company may be impaired. Where any such indication exists the company estimates the recoverable amount of the assets. The recoverable amount of the assets (or where applicable that of the cash generating unit to which the asset belongs) is estimated at the higher of its net selling price and its value in use. An impairment charge is recognised whenever the carrying amount of the asset or cash-generating unit exceeds its recoverable amount.

d) Inventories:

i. Raw Materials, Containers, Stores and Spares

Raw materials, packing materials, stores, spares and consumables are valued at lower of cost (net of refundable taxes and duties) or net realizable value. The cost of these items of inventory are determined on FIFO basis and comprises of cost of purchase and other incidental costs incurred to bring the inventories to their present location and condition.

ii. Finished Goods and Work-in-progress

Work in progress and finished goods are valued at lower of cost or net realizable value. The cost of work in process and finished goods includes cost of conversion and other costs incurred to bring the inventories to their present location and condition.

iii. Traded Goods

Traded Goods are valued at lower of cost and net realizable value. Cost is determined on FIFO basis.

Excise Duty in respect of finished goods lying in factory premises are provided for and included in valuation of inventory in case of non Export Items.

e) Employee benefits

Short-term employee benefits are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

Cost of post employment benefits relating to Defined Contribution Plans such as contribution to Provident Fund employee pension fund etc are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

The Company has Defined Benefit Plan for post employment benefits in the form of Gratuity for all employees administered through trust, funded with Life Insurance Corporation of India. Liability for the this Defined Benefit Plans is provided on the basis of actuarial valuation, as at the balance sheet date, carried out by independent actuary. The actuarial method used for measuring the liability is the Projected Unit Credit Method. The actuarial gains and losses arising during the year are recognized in the Profit & Loss Account for the year

f) Research and Development Costs

Research and development costs incurred for development of products are charged to revenue as incurred, except for development costs relating to the design and testing of new or improved materials, products or processes which are recognized as intangible assets to the extent that it is expected that such assets will generate future economic benefits. Research and development expenditure of capital nature is added to fixed assets.

g) Revenue Recognition:

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership to the buyer. Sales are stated net of excise duty, sales tax and trade discounts.

Interest on deployment of surplus funds is recognized using the time-proportion method, based on interest rates implicit in the transaction based on reasonable certainty of receipt. Interest on advances is recognized when the ultimate collection is not uncertain.

Dividend income is recognized when the right to receive dividend is established.

h) Taxation

Income tax expense comprises current tax expense and deferred tax expense/credit.

i. Current tax

Provision for current tax is calculated in accordance with the provisions of the Income-Tax Act, 1961 and is made annually based on the tax liability computed after considering tax allowances and exemptions.

Assets and liabilities representing current tax are disclosed on a net basis when there is a legally enforceable right to set off and where the management intends to settle the asset and liability on a net basis.

ii. Deferred tax

Deferred tax liability or asset is recognised for timing differences between the profits/losses offered for income taxes and profits/losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date.

Deferred tax assets are recognised only to the extent there is a reasonable certainty that the assets can be realised in future; however where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written-up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realised.

i) Investment

Current investments are carried at the lower of cost and fair value computed category wise. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made, only if, in the opinion of the management, such a decline is regarded as being other than temporary.

j) Earnings per share (''EPS'')

Basic EPS is computed using the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year except where the results would be anti dilutive. The number of equity shares is adjusted for any share splits and bonus shares issued effected prior to the approval of the financial statements by the Board of Directors.

k) Contingencies and provisions

The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

l) Foreign currency transactions

Foreign currency transactions are recorded at exchange rates prevailing on the date of the transaction. The difference between the actual rate of settlement and the rate on the date of the transaction is charged or credited to profit and loss account.

In respect of monetary current assets and liabilities denominated in foreign currencies the overall net gain or loss, if any, on conversion at the exchange rates prevailing on the date of the balance sheet is charged to revenue.


Mar 31, 2012

A) Fixed assets

i. Tangible Fixed Assets

Tangible fixed assets are stated at historical cost less accumulated depreciation. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the asset to its working condition for the intended use.

Borrowing costs directly attributable to acquisition or construction of those tangible fixed assets, which necessarily take a substantial period of time to get ready for their intended use, are capitalized.

Advances paid towards acquisition of fixed assets and the cost of assets acquired but not ready for use as at the balance sheet date are disclosed under capital work-in-progress.

ii. Intangible Assets

Intangible fixed assets are stated at historical cost less accumulated amortization. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the assets to its working condition for the intended use. Cost is amortized over its useful economic life based on expected benefit.

b) Depreciation

All tangible fixed assets, except freehold land, leasehold land and capital work in progress, are depreciated on a straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies' Act, 1956.

c) Impairment:

In accordance with accounting standard 28 on 'Impairment of assets', the Company assesses at each balance sheet date whether there is an indication that assets of the Company may be impaired. Where any such indication exists the company estimates the recoverable amount of the assets. The recoverable amount of the assets (or where applicable that of the cash generating unit to which the asset belongs) is estimated at the higher of its net selling price and its value in use. An impairment charge is recognised whenever the carrying amount of the asset or cash-generating unit exceeds its recoverable amount.

d) Inventories:

i. Raw Materials, Containers, Stores and Spares

Raw materials, packing materials, stores, spares and consumables are valued at lower of cost (net of refundable taxes and duties) or net realizable value. The cost of these items of inventory are determined on FIFO basis and comprises of cost of purchase and other incidental costs incurred to bring the inventories to their present location and condition.

ii. Finished Goods and Work-in-progress

Work in progress and finished goods are valued at lower of cost or net realizable value. The cost of work in process and finished goods includes cost of conversion and other costs incurred to bring the inventories to their present location and condition.

iii. Traded Goods

Traded Goods are valued at lower of cost and net realizable value. Cost is determined on FIFO basis.

Excise Duty in respect of finished goods lying in factory premises are provided for and included in valuation of inventory in case of non Export Items.

e) Employee benefits

Short-term employee benefits are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

Cost of post employment benefits relating to Defined Contribution Plans such as contribution to Provident Fund employee pension fund etc are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

The Company has Defined Benefit Plan for post employment benefits in the form of Gratuity for all employees administered through trust, funded with Life Insurance Corporation of India. Liability for the this Defined Benefit Plans is provided on the basis of actuarial valuation, as at the balance sheet date, carried out by independent actuary. The actuarial method used for measuring the liability is the Projected Unit Credit Method. The actuarial gains and losses arising during the year are recognized in the Profit & Loss Account for the year

f) Research and Development Costs

Research and development costs incurred for development of products are charged to revenue as incurred, except for development costs relating to the design and testing of new or improved materials, products or processes which are recognized as intangible assets to the extent that it is expected that such assets will generate future economic benefits. Research and development expenditure of capital nature is added to fixed assets.

g) Revenue Recognition:

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership to the buyer. Sales are stated net of excise duty, sales tax and trade discounts.

Interest on deployment of surplus funds is recognized using the time-proportion method, based on interest rates implicit in the transaction based on reasonable certainty of receipt. Interest on advances is recognized when the ultimate collection is not uncertain.

Dividend income is recognized when the right to receive dividend is established.

h) Taxation

Income tax expense comprises current tax expense and deferred tax expense/credit.

i. Current tax

Provision for current tax is calculated in accordance with the provisions of the Income-Tax Act, 1961 and is made annually based on the tax liability computed after considering tax allowances and exemptions.

Assets and liabilities representing current tax are disclosed on a net basis when there is a legally enforceable right to set off and where the management intends to settle the asset and liability on a net basis.

ii. Deferred tax

Deferred tax liability or asset is recognised for timing differences between the profits/losses offered for income taxes and profits/losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date.

Deferred tax assets are recognised only to the extent there is a reasonable certainty that the assets can be realised in future; however where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written-up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realised.

i) Investment

Current investments are carried at the lower of cost and fair value computed category wise. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made, only if, in the opinion of the management, such a decline is regarded as being other than temporary.

j) Earnings per share ('EPS')

Basic EPS is computed using the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year except where the results would be anti dilutive. The number of equity shares is adjusted for any share splits and bonus shares issued effected prior to the approval of the financial statements by the Board of Directors.

k) Contingencies and provisions

The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

l) Foreign currency transactions

Foreign currency transactions are recorded at exchange rates prevailing on the date of the transaction. The difference between the actual rate of settlement and the rate on the date of the transaction is charged or credited to profit and loss account.

In respect of monetary current assets and liabilities denominated in foreign currencies the overall net gain or loss, if any, on conversion at the exchange rates prevailing on the date of the balance sheet is charged to revenue.


Mar 31, 2011

(a) Basis of Preparation :

The financial statements have been prepared under the historical cost convention on an accrual basis and comply in all material respects with the Accounting Standards notified by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956.

(b) Use of estimates:

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual result and estimates are recognized in the period in which the results are known / materialized.

(c) Fixed assets :

Tangible Fixed Assets

Tangible fixed assets are stated at historical cost less accumulated depreciation. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the asset to its working condition for the intended use.

Borrowing costs directly attributable to acquisition or construction of those tangible fixed assets, which necessarily take a substantial period of time to get ready for their intended use, are capitalized.

Advances paid towards acquisition of fixed assets and the cost of assets acquired but not ready for use as at the balance sheet date are disclosed under capital work-in-progress.

Intangible Assets

Intangible fixed assets are stated at historical cost less accumulated amortisation. Cost comprises purchase price, duties, levies and other directly attributable expenses of bringing the assets to its working condition for the intended use. Cost is amortised over its useful economic life based on expected benefit.

(d) Depreciation :

All tangible fixed assets, except freehold land, leasehold land and capital work in progress, are depreciated on a straight line method at the rates and in the manner prescribed in Schedule XIV to the Companies' Act, 1956.

(e) Impairment :

In accordance with accounting standard 28 on 'Impairment of assets', the Company assesses at each balance sheet date whether there is an indication that assets of the Company may be impaired. Where any such indication exists the company estimates the recoverable amount of the assets. The recoverable amount of the assets (or where applicable that of the cash generating unit to which the asset belongs) is estimated at the higher of its net selling price and its value in use. An impairment charge is recognised whenever the carrying amount of the asset or cash-generating unit exceeds its recoverable amount.

(f) Inventories :

Raw Materials, Containers, Stores and Spares

Raw materials, packing materials, stores, spares and consumables are valued at lower of cost (net of refundable taxes and duties) or net realizable value. The cost of these items of inventory are determined on FIFO basis and comprises of cost of purchase and other incidental costs incurred to bring the inventories to their present location and condition.

Finished Goods and Work-in-progress

Work in progress and finished goods are valued at lower of cost or net realizable value. The cost of work in process and finished goods includes cost of conversion and other costs incurred to bring the inventories to their present location and condition.

Traded Goods

Traded Goods are valued at lower of cost and net realizable value. Cost is determined on FIFO basis.

Excise Duty in respect of finished goods lying in factory premises are provided for and included in valuation of inventory in case of non Export Items.

(g) Employee benefits

Short-term employee benefits are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

Cost of post employment benefits relating to Defined Contribution Plans such as contribution to Provident Fund employee pension fund etc are recognized as an expense in the profit and loss account of the year in which the related service is rendered.

The Company has Defined Benefit Plan for post employment benefits in the form of Gratuity for all employees administered through trust, funded with Life Insurance Corporation of India. Liability for the this Defined Benefit Plans is provided on the basis of actuarial valuation, as at the balance sheet date, carried out by independent actuary. The actuarial method used for measuring the liability is the Projected Unit Credit Method. The actuarial gains and losses arising during the year are recognized in the Profit & Loss Account for the year

(h) Research and Development Costs

Research and development costs incurred for development of products are charged to revenue as incurred, except for development costs relating to the design and testing of new or improved materials, products or processes which are recognized as intangible assets to the extent that it is expected that such assets will generate future economic benefits. Research and development expenditure of capital nature is added to fixed assets.

(i) Revenue Recognition:

Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership to the buyer. Sales are stated net of excise duty, sales tax and trade discounts.

Interest on deployment of surplus funds is recognized using the time-proportion method, based on interest rates implicit in the transaction based on reasonable certainty of receipt. Interest on advances is recognized when the ultimate collection is not uncertain.

Dividend income is recognized when the right to receive dividend is established.

(j) Taxation :

Income tax expense comprises current tax expense and deferred tax expense/credit.

Current tax

Provision for current tax is calculated in accordance with the provisions of the Income-Tax Act, 1961 and is made annually based on the tax liability computed after considering tax allowances and exemptions.

Assets and liabilities representing current tax are disclosed on a net basis when there is a legally enforceable right to set off and where the management intends to settle the asset and liability on a net basis.

Deferred tax

Deferred tax liability or asset is recognised for timing differences between the profits/losses offered for income taxes and profits/ losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date.

Deferred tax assets are recognised only to the extent there is a reasonable certainty that the assets can be realised in future; however where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each balance sheet date and written down or written-up to reflect the amount that is reasonably/virtually certain (as the case may be) to be realised.

(k) Investment

Current investments are carried at the lower of cost and fair value computed category wise. Long term investments are stated at cost. Provision for diminution in the value of long term investments is made, only if, in the opinion of the management, such a decline is regarded as being other than temporary.

(l) Earnings per share ('EPS')

Basic EPS is computed using the weighted average number of equity shares outstanding during the year. Diluted EPS is computed using the weighted average number of equity and dilutive equity equivalent shares outstanding during the year except where the results would be anti dilutive. The number of equity shares is adjusted for any share splits and bonus shares issued effected prior to the approval of the financial statements by the Board of Directors.

(m) Contingencies and provisions

The Company creates a provision when there is present obligation as a result of a past event that probably requires an outflow of resources and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.


Mar 31, 2010

BASIS OF ACCOUNTING

1. Classification of Income and expenditure {Except Otherwise Indicated}

(i) All Expenditure and income are accounted for under the natural head of accounts.

(ii) All financial items of income and expenditure having a matterial bearing on the financial statement are recognised on accrual basis, except income by way of dividend and expenses by way of leave encashment which is accounted on cash basis

(iii) Consolidated financial statement of parent & subsidiary company prepared in addtion to separate financial statement of subsidiary company.

2. VALUATION

(i) FIXED ASSETS

Fixed assets are normally accounted on cost basis including cost of acquisition, installation and net of modvat. Impairment loss, if any is recongnised in the year in which impairment take place.

(ii) INVENTORIES

Inventories are valued at cost or net realisable value whichever is lower. The cost is determined on FIFO basis and where applicable includes the cost of materials (net of available cenvet credit), labour and factory overheads. Finished products includes excise duty on products manufactured.

(iii) Trading Investment are valued at cost of market value whichever is lower if any.

3. Stores, spares tools and dies are charges to revenue.

4. DEPRECIATION

(i) Depreciation on fixed assets are provided on straight line method at the rate and method prescribed in schedule xiv to the companies Act,1956.

(ii) Depreciation on addition/deletion on fixed assets are provided on pro rata basis.

(iii) Depreciation on R&D Assets are not provided by the Company.

5. SALES

(i) Export sales are accounted at current prevailing rate and on realisation difference of exchnage rate is adjusted in the accounts.

(ii) Sales goods return, rate difference, currency rate difference and claims, etc. are adjusted in the sales and accounted in the year in which transaction have taken place.

(iii) The sales is inclusive of excise duty and value added tax as applicable.

6. PURCHASE

I Purchase goods returns are adjusted from the purchase of the year in which the transaction take place.

II Purchased goods are inclusive of excise duty .value added tax and purchased related direct expenses.

7. RETIREMENT BENEFITS :

I The company has taken a group policy for gratuity with the Life Insurance Corporation of india. The gratuity liabilities is accounted as per the actuarial contribution demanded by L.I.C.

ii The company makes contribution to providend fund which are recongnised in the profit & loss account on accruals basis.

8. INVESTMENT

Long term & short term investment are stated at cost after deducting provision made , if any, for permanat diminution in the value.

Trading Investment are shown as a current assets under the head of inventory, profit or loss arise on sales of trading investment are accounted as business profit or loss if any

9. MISC. EXPENDITURE

Public issue , preliminary expenses and defered revenue expenses if any are written off over a period.

10. CONTINGENT LIABILITIES :-

Contigent liabilities are not provided for in the accounts. These are disclosed by way of notes to the accounts.

11. CAPITAL WORK IN PROGRESS

These are stated at cost and other relevant overheads inccured during the construction period.

12. CLAIM BY/AGAINST THE COMPANY

Claim by/against the company arising on any account are provided in the accounts on receipts/ acceptance basis.

13. RESERCH & DEVELOPMENT

Revenue expenditure on R & D are charged to respective head of acccounts in the year in which they are inccured. Capital expenditure on R & D are treated as addition to fixed assets. No depreciation on R & D assets has been provided.

14. FOREIGN CURRENCY TRANSACTIONS

1 Assets and liabilities in foreign currency, covered by forward contracts are stated at forward contract rate while those not covered by forward contracts are stated at the rate ruiling at the time of transaction/ settlement taken place.

2 Exchange difference relating to fixed assets are adjusted in the cost of the assets.

3 Any other exchange difference are dealt with in the profit & loss account.

15 The consolidated finanacial statement relate to Lincoln Pharmaceuticals Limited (the Parent Company) and its subsidiaries - Zullinc Healthcare limited.

16 Principles of Consolidation

The consolidated financial statement have been prepared in accordance with Accounting Standared 21 (AS- 21)- "Consolidated Finanacial Statement issued by the Institute of Chartered Accountant of India. The Consolidated financial statements have been prepared on the following basis.

i. The financial Statements of the parent and its subsidaries have been combined on a line by line basis by adding together the book values of like items of assets, liabilites, income and expenses, after fully eliminating intra-group balances and unrealised profit or losses of intra group transactions.

ii The consolidated financial statements have been prepared using uniform accounting policies for like transaction and other events in similar circumtances and are presented, to the extent possible, in the same manner as the parent companys seprate financial statement

iii The excess of cost to the parent company of its investment in the subsidiary over the parent companys portion of equity of the subsidiary is recognised in the finacial statements as Goodwill. This goodwill is tested for impairment at end of financial year. The excess of parent company portion of equity over the cost of investement as at the date of its investment is treateas as capital reserve

iv The finanacial statements of the Subsidiaries used in the consolidation are drawn up to the same reporting date as that of the parent company i.e. year ended march 31, 2010.

V Consolidated financial statement of parent & subsidiary company prepared in addtion to separate financial statement of subsidiary company.


Mar 31, 2009

BASIS OF ACCOUNTING

1. Classification of Income and expenditure {Except Otherwise Indicated}

(i) All Expenditure and income are accounted for under the natural head of accounts.

(ii) All financial items of income and expenditure having a matterial bearing on the financial statement are recognised on accrual basis, except income by way of dividend and expenses by way of leave encashment which is accounted on cash basis

(iii) Consolidated financial statement of parent & subcidiary company prepared in addtion to separate financial statement of subcidiary company.

2. VALUATION

(i) FIXED ASSETS

Fixed assets are normally accounted on cost basis including cost of acquisition, installation and net of modvat. impairment loss, if any is recongnised in the year in which impairment take place.

(ii) INVENTORIES

inventories are valued at cost or net realisable value whichever is lower. The cost is determined on FIFO basis and where applicable includes the cost of materials (net of available cenvet credit), labour and factory overheads. Finished products includes excise duty on products manufactured.

(iii) Trading Investment are valued at cost of market value whichever is lower.

3. Stores, spares tools and dies are charges to revenue.

4. DEPRECIATION

(i) Depreciation on fixed assets are provided on straight line method at the rate and method prescribed in schedule xiv to the companies Act, 1956.

(ii) Depreciation on addition/deletion on fixed assets are provided on pro rata basis.

5. SALES

(i) Export sales are accounted at current prevailing rate and on realisation difference of exchnage rate is adjusted in the accounts.

(ii) Sales goods return, rate difference, claims, etc. are accounted in the year in which the transaction are taken place.

(iii) The sales is inclusive of excise duty and value added tax as applicable.

6. PURCHASE

I Purchase goods returns are adjusted from the purchase of the year in which the transaction take place.

II Purchased goods are inclusive of excise duty, value added tax and purchased related direct expenses.

7. RETIREMENT BENEFITS:

I The company has taken a group policy for gratuity with the Life Insurance Corporation of india. The gratuity liabilities is accounted as per the actuarial contribution demanded by L.I.C.

ii The company makes contribution to providend fund which are recongnised in the profit & loss account on accruals basis.

8. INVESTMENT

Long term & short term investment are stated at cost after deducting provisior made, if any, for permanat diminution in the value.

Trading Investment are shown as a current assets under the head of inventory, profit or loss arise on sales of trading investment are accounted as business profit or loss.

9. MISC. EXPENDITURE

Public issue , preliminary expenses and defered revenue expenses if any are written off over a period.

10. CONTINGENT LIABILITIES:-

Contigent liabilities are not provided for in the accounts. These are disclosed by way of notes to the accounts.

11. CAPITAL WORK IN PROGRESS

These are stated at cost and other relevant overheads inccured during the construction period.

12. CLAIM BY/AGAINST THE COMPANY

Claim by/against the company arising on any account are provided in the accounts on receipts/ acceptance basis.

13. RESERCH & DEVELOPMENT

Revenue expenditure on R & D are charged to respective head of acccounts in the year in which they are inccured. Capital expenditure on R & D are treated as addition to fixed assets. No depreciation on R & D assets has been provided.

14. FOREIGN CURRENCY TRANSACTIONS

1 Assets and liabilities in foreign currency, covered by forward contracts are stated at forward contract rate while those not covered by forward contracts are stated at the rate ruiling at the year end.

2 Exchange difference relating to fixed assets are adjusted in the cost of the assets.

3 Any other exchange difference are dealt with in the profit & loss account.

15 The consolidated finanacial statement relate to Lincoln Pharmaceuticals Limited (the Parent Company) and its subsidiaries - Zullinc Healthcare limited.

16 Principles of Consolidation

The consolidated financial statement have been prepared in accordance with Accounting Standared 21

(AS-21)- "Consolidated Finanacial Statement issued by the Institute of Chartered Accountant of India. The Consolidated financial statements have been prepared on the following basis.

i. The financial Statements of the parent and its subsidaries have been combined on a line by line basis by adding together the book values of like items of assets.liabilites,income and expenses,after fully eliminating intra-group balances and unrealised profit or losses of intra group transactions.

ii The consolidated financial statements have been prepared using uniform accounting policies for like transaction and other events in similar circumtances and are presented, to the extent possible, in the same manner as the parent companys seprate financial statement

iii The excess of cost to the parent company of its investment in the subsidiary over the parent companys portion of equity of the subsidiary is recognised in the finacial statements as Goodwill. This goodwill is tested for impairment at end of financial year. The excess of parent company portion of equity over the cost of investement as at the date of its investment is treated as capital reserve

iv The finanacial statements of the Subsidiaries used in the consolidation are drawn up to the same reporting date as that of the parent company i.e. year ended march 31,2009.

V Consolidated financial statement of parent & subcidiary company prepared in addtion to separate financial statement of subcidiary company.

 
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