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Notes to Accounts of Venus Remedies Ltd.

Mar 31, 2015

1 Other payables includes salary payable, sales tax, TDS payable and all other payables.

2 Inventories are valued as per method described in significant accounting policies.

3 The Company has sent letter of balance confirmation to all the parties but only a few have responded so far. So the balance in the party accounts whether in debit or credit are subject to reconciliation.

4 Balance with Banks includes Unclaimed Dividend of Rs. 45.56 Lacs (Previous Year Rs. 54.04 Lacs).

5 Fixed deposits with banks include deposits of Rs. Nil (Previous year Rs. 18.19 Lacs) with the maturity of more than 12 months.

6 An amount of Rs. 282.65 Lacs (Previous Year Rs. 367.74 Lacs) is held with Banks as margin money for Bank Guarantees/ Letter of Credit.

7 Other Loans and Advances includes Advances to suppliers, Prepaid Expenses, Advance Income Tax & TDS Receivable etc.

8 Other Operating Revenue includes Rs. 52.61 Lacs received / receivable from Government as Export Incentives.

As per Accounting Standard 15"Employee Benefits", the disclosures as defined in the Accounting Standard are given below:

The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognised each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

9 The previous year figures have been re-arranged and re-grouped where ever found necessary.

10 The company operates only in one business segment viz. "PharmaceuticalFormulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI.

11 During the year, the company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognized for the year.

12 During the year the Company has changed the depreciation policy from straight line method to Useful Life method of depreciation as prescribed in Schedule II of the Companies Act, 2013. Due to this change in the method of depreciation, the reported amount of depreciation is lower by 10.87 lacs. However depreciation on fixed assets whose useful life is already exhausted as on 01.04.2014 amounting to Rs. 247.04 lacs has been debited to General Reserve Account. The corresponding Deferred Tax Liability on such fixed assets amounting to Rs. 49.43 lacs has also been reserved and credited to General Reserve Account.

13 In the opinion of the board, and to the best of their knowledge and belief, the value on realization of the current assets, loans & advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for allknown and determined liabilities has been made.

14 As per the provisions of FCCB agreement, the FCCB was to be converted intoequity shares by 01-02-2015. However, the bond holder have not exercise their option to convert the bonds into equity shares. Therefore, the company has made he provision of interest amount in the books of accounts.

15 During the year, the Company's proposal for restructuring of its debts was approved by Corporate Debt Restructuring Cell (CDR Cell) on 25.1 1.2014 and communicated vide its Letter of Approval (LOA) dated December 17, 2014.

Lenders with the approval of CDR EG shall have the right to recompense the reliefs/ sacrifices/waivers extended by respective CDR Lenders as per th CDR guidelines. The recompense payable is contingent on various factors including improved performance of the Company and many other conditions, the outcome of which is currently materially uncertain. Tentative recompense amount comes to Rs. 12.47 crores in 2014-15.

16 The figures in the Balance Sheet and Profit & Loss Account for the year have been rounded off to nearest lacs.

Names of related parties and description of relationship:

1. Wholly Owned Subsidiary Venus Pharma GmbH

2. Associates Sunev Pharma Solutions Limited Spine Software Systems Pvt Limited

3. Key Management Personnel Mr. Pawan Chaudhary Mrs. Manu Chaudhary Mr. Peeyush Jain Mr. Ashutosh Jain

17 Contingent Liabilities and Commitments (Rs. in Lacs)

Particulars Current Year Previous Year

Contingent Liabilities

a) Letter of Credit / Bank Guarantees 222.98 81.43 — Inland

b) Bank Guarantees foreign 1.25 24.70

c) Letter of credit — Foreign 126.00 379.48

d) Interest on FCCB's - 84.07

e) Tax demand pending in appeal 208.03 140.11

Auditors' Report in term of our separate report of even date annexed here to.


Mar 31, 2014

1.1 Balance with Banks includes Unclaimed Dividend of Rs.54.04 Lacs (Previous Year Rs.51.45 Lacs).

1.2 Fixed deposits with banks include deposits of Rs.18.19 Lacs (Previous year Rs.65.52 Lacs) with the maturity of more than 12 months

1.3 An amount of Rs.367.74 Lacs (Previous Year Rs.304.49 Lacs) is held with Banks as margin money for Bank Guarantees/Letter of Credit.

2.1 Other Loans and Advances includes Advances to suppliers, Prepaid Expenses, Advance Income Tax S TDS Receivable etc

2.1 Other Operating Revenue includes Rs.1.31 crores received/ receivable from Government as Export Incentives

As per Accounting Standard 15"Employee Benefits", the disclosures as defined in the Accounting Standard are given below

The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method , which recognised each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation

NOTE: 3

The company operates only in one business segment viz. "Pharmaceutical Formulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI

NOTE: 4

During the year, the company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognized for the year.

NOTE: 5

The company has continued investing in its intellectual Property rights and in result of that company has got many patents for its RSD products. This year company has been granted for patent rights for Elores from Japan, Achnil from USA and many more. Elores a block buster product of the company has been awarded the UBM India Pharma Award 2013

NOTE: 6

In the opinion of the board, and to the best of their knowledge and belief, the value on realization of the current assets, loans & advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for all known and determined liabilities has been made

NOTE: 7

As per the provisions of FCCB agreement, the FCCB will be converted into equity shares by automatic route without the option of bond holders. The conversion is due on 1st February, 2015. The foreign exchange rate has been fixed at Rs.45.06 per USD as per the FCCB agreement for the purpose of conversion

NOTE: 8

The figures in the Balance Sheet and Profit S Loss Account for the year have been rounded off to nearest lacs

Names of related parties and description of relationship :

1. Wholly Owned Subsidiary Venus Pharma GmbH

2. Associates Sunev Pharma Solutions Limited

Spine Software Systems Pvt Limited

3. Key Management Personnel Mr.Pawan Chaudhary

Mrs. Manu Chaudhary Mr. Peeyush Jain Mr. Ashutosh Jain

NOTE: 9 CONTINGENT LIABILITIES AND COMMITMENTS (Rs in Lacs) Year ended Year ended Paticular 31.3.2014 31.3.2014

Contingent Liabilities

a) Letter of Credit/ Bank Guarantees -Inland 81.43 357.18

b) Bank Guarantees foreign 24.70 40.48

c) Letter of credit-Foreign 379.48 1381.89

d) Interest on FCCB''s 84.07 100.89

e) Tax demand pending in appeal 140.11 38.72

NOTE: 10

In light of lending institutions" terms for Corporate Debt Rephasing which have mandated not to declare dividend for the year 2013-14. In compliance of such terms the recommendation of the dividend made on 13th August, 2014 stands withdrawn by the Board. Consequently the Board approved the revision of audited Financial Results for the year ended on 31st March, 2014 to the extent of removal of accounting for dividend S dividend tax for the year ended on 31st March, 2014. There is no other revision of the audited balance sheet


Mar 31, 2013

NOTE : 1

The company operates only in one business segment viz. "Pharmaceutical Formulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI.

NOTE : 2

During the year, the company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognized for the year.

NOTE : 3

The company has made investments in its intellectual Property rights wealth to extend its global reach, updation and commercialization of its R&D products. This year also company has been granted many patent rights and product registrations from countries like USA , Japan, Australia, South Korea, Canada , Mexico etc.

NOTE : 4

In the opinion of the board, and to the best of their knowledge and belief, the value on realization of the current assets, loans & advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for all known and determined liabilities has been made.

NOTE : 5

The figures in the Balance Sheet and Profit & Loss Account for the year have been rounded off to nearest lacs.

NOTE : 6 CONTINGENT LIABILITIES AND COMMITMENTS

Contingent Liabilities

a) Letter of Credit / Bank Guarantees - Inland 357.18 253.7

b) Bank Guarantees foreign 40.48 11.85

c) Letter of credit - Foreign 1381.89 51.12

d) Interest on FCCB''s 100.89 94.73


Mar 31, 2012

1.1 The company has issued 17.00 Lacs warrants @ Rs 212.20 /- each to be converted into equity shares as under :

9.00 Lacs warrants shall be converted into 9.00 Lacs equity shares on or before 31.03.2014

8.00 Lacs warrants shall be converted into 8.00 Lacs equity shares on or before 31.03.2013

2.1 Inventories are valued as per method described in significant accounting policies.

3.1 The Company has sent letter of balance confirmation to all the parties but only a few have responded so far. So the balance in the party accounts whether in debit or credit are subject to reconciliation.

4.1 Balance with Banks includes Unclaimed Dividend ofRs. 46.85 Lacs (Previous Year Rs 45.57 Lacs)

4.2 Fixed deposits with banks include deposits of Rs 1.30 Lacs (Previous year Rs 0.30 Lacs) with the maturity of more than 12 months.

4.3 An amount of Rs 192.65 Lacs (Previous Year Rs 78.44 Lacs) is held with Banks as margin money for Bank Guarantees/ Letter of Credit

5.1 Other Loans and Advances includes Advances to suppliers , Prepaid Expenses , Advance Income Tax Et TDS Receivable etc.

As per Accounting Standard 15"Employee Benefits", the disclosures as defined in the Accounting Standard are given below :

The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method , which recognised each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.

NOTE: 6

During the year company has issued 17.00 lacs. Share warrants to Sunev Pharma Solutions Limited. Allotted 6.00 lacs. Shares on conversion of already issued 6.00 lacs share warrants. The Company has also allotted 12,894 equity shares to FCCB holders as per the option exercised by bond holders.

NOTE: 7

The Company operates only in one business segment viz. "Pharmaceutical Formulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the Company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI.

NOTE: 8

During the year, the Company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognised for the year.

NOTE: 9

Similar to the previous years, the Company has made investments in its intellectual Property rights wealth, R Et D Equipments and infrastructure during the current year also. As a result of it, the Company has been granted patents rights from USA, Japan, South Africa among others. The company has got the patent award from Phamexcil for the Financial Year 2011-12. Company's new REtD product ACHNIL, a once a day pain killer has been awarded the BIOSPECTRUM PRODUCT OF THE YEAR.

NOTE: 10

In the opinion of the board, and to the best of their knowledge and belief, the value on realisation of the current assets, loans Et advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for all known and determined liabilities has been made.

NOTE: 11

The figures in the Balance Sheet and Profit Et Loss Account for the year have been rounded off to nearest lacs.


Mar 31, 2011

1. The figures for the year have been re-grouped / re-arranged / re-cast wherever necessary to make it comparable.

2. A sum of Rs. NIL (Previous Year 82,998) (Maximum outstanding during the year Rs. 78,536/- Previous year 418,055/-) is due from Directors of the company being imprest for traveling, conveyance and other charges.

3. Fixed deposits with banks of Rs. 7,844,212 (previous year Rs. 8,790,000) as pledged as Margin Money with banks.

4. Expenses includes Rs. 124,180/- (P/Y Rs. 76,100-) as expenses relating to previous years.

5. Income includes Rs. NIL/- (P/Y Rs. 600) as income related to previous year.

6. Disclosure as required by AS-18 (Related Party) issued by ICAI

i) List of related parties where control exist and related parties with whom transactions have taken place and relationship:

S. No. Name of Related Party Relationship

1 Venus Pharma GmbH Wholly owned Subsidiary Company

2 Sunev Pharma Solutions Ltd. Associates

3 Mr. Pawan Chaudhary

Mrs. Manu Chaudhary

Key Managerial Personnel Mr. Peeyush Jain

Mr. Ashutosh Jain

7. The company operates only in one business segment viz. "Pharmaceutical Formulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI.

8. In the opinion of the board, and to the best of their knowledge and belief, the value on realization of the current assets, loans & advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for all known and determined liabilities has been made.

9. Some of suppliers of material have been identified as small scale industrial undertaking on the basis of information available with the company. However none of these parties has an outstanding credit balance exceeding Rs. 100,000.00 as on 31.03.2011

10. Contingent Liabilities (AS-29)

Particulars Current Year Previous Year

(Not provided for in the books of accounts

(a) Letter of Credit / Bank Guarantees-Inland 204.82 Lacs 423.01 Lacs

(b) Bank Guarantee Foreign 53.53 Lacs 73.42 Lacs

(c) Letter of Credit Foreign 189.95 Lacs 248.74 Lacs

11. During the year the company has issued 12, 00,000 Share warrants to Sunev Pharma Solutions Limited out of which 6, 00,000 warrants are converted into 6,00,000 equity shares. The company has also allotted 37,137 equity shares to FCCB holders.

12. The Company has taken a step towards advancement, and has decided to set up a global marketing chamber at Derabassi, Mohali.

13. During the year, the company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognized for the year.

14. The figures in the Balance Sheet and Profit & Loss Account for the year have been rounded off to nearest multiple of rupee.

15. The company has provided for gratuity and leave encasement as per valuation which was done as required under accounting standard (AS-15) "accounting for retirement benefits".

16. The company is continuously making investments in its intellectual Property rights wealth. This year company has filed more patents in different countries for its Research products. As a result of huge past and present investments in R&D Pilot Plant and equipment, the R&D wing of the company is day by day giving new products to the company and has also got renewal of recognition from Department of Scientific and Industrial Research, New Delhi for a period of five years.


Mar 31, 2010

1. A sum of Rs 82,998 (Previous Year Rs NIL) (Maximum outstanding during the year Rs 4,18,055/-. Previous year Rs 5,68,030/) is due from Directors of the company being imprest for Travelling, conveyance and other charges.

2. Fixed deposits with banks of Rs 87,90,000.00 (previous year Rs 56,44,235) as pledged as Margin Money with banks.

3. Expenses includes Rs 76,100/- (P/Y Rs 1,79,630-) as expenses relating to previous years.

4. Income includes Rs 600/- (P/Y NIL) as income related to previous year.

5. The company has carried on making investments in its Intellectual Property Rights Wealth. In result of the IPR Investments in previous years company has got patents of its Research products like Salbactomax, Potentox, Tobracef, Aceclofenac in many countries.This year company has filed many patents in different Countries for its Research products and has successfully out licensed salbactomax to a Korean company. The Company has got Market Authorisation from Portugal and added one more product to its high potency research product basket called Mebatic. To maintain the quality standard and further improvement in quality of products, company is making investment for automisation of its existing Plant & Machinery, Equipments and other quality instruments. In result of huge past and present investment in R&D Pilot Plant and equipments, the R&D wing of the company is day by day giving new products to the company and has also got approval from Department of Scientific & Industrial Research, New Delhi under Section 35 ( 2AB) of Income Tax Act, 1961. This will enhance the financial benefits to company and further accelerate the R & D efforts & activities of the company.

6. The company operates only in one business segment viz. "Pharmaceutical Formulation" and is engaged in manufacturing and trading of medicines. Since in the opinion of management, the inherent nature of activities engaged by the company are governed by the same set of risks and rewards, so these have been grouped and identified as a single segment in accordance with the Accounting Standard on Segment Reporting (AS-17) issued by ICAI.

7. In the opinion of the board, and to the best of their knowledge and belief, the value on realisation of the current assets, loans & advance shown in the Balance Sheet in the ordinary course of business will be at least equal to the amount at which they are stated in the Balance Sheet and provision for all known and determined liabilities has been made.

8. The wholly Owned Subsidiary "Venus Pharma GmbH" was operated at Werne, Germany, Accordingly, the Balance sheet of Wholly Owned Subsidiary has been consolidated along with the Present Company in accordance with the Accounting Standard on Consolidated Financial Statement" (AS-21).

9. The Company and the bondholders had arrived at an agreement for settlement of FCCBs of US$ 14 million (Including interest of US$ 2 million). According to the agreement US$ 9 million was to be paid in cash and US$ 5 million was to be rollover for a period of 5 years. As per the convenience of both the parties US$ 9 million has been paid. The company has also received approval of Reserve Bank of India for the rollover of FCCBs of US$ 5 million for a period of five years. With this, the entire issue of FCCB has been fully and finally settled with the FCCB holders.

10. Some of suppliers of material have been identified as small scale industrial undertaking on the basis of information available with the company. However none of these parties has an outstanding credit balance exceeding Rs 1,00,000.00 as on 31.03.2010.

11. Contingent Liabilities: (Not provided for in the books of accounts

Current Year Previous Year

a) Letter of Credit / Bank Guarantees-Inland 423.01 Lacs 219.90 Lacs

b) Bank Guarantee Foreign 73.42 Lacs 6.25 Lacs

c) Letter of Credit Foreign 248.74 Lacs 257.12 Lacs

12. During the year, the company has undertaken a review of all fixed assets in line with the requirements of AS-28 on "Impairment of Assets" issued by the Institute of Chartered Accountant of India. Based on such review, no provision for impairment is required to be recognised for the year.

13. The figures in the Balance Sheet and Profit & Loss Account for the year have been rounded off to nearest multiple of Rs.

14. The company has provided for gratuity and leave encashment as per valuation which was done as required under accounting standard (AS-15) "accounting for retirement benefits".

 
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