moneycontrol.com भारत | लेखांकन नीति > Pharmaceuticals > लेखांकन नीति फॉलोड से एलकॉन पैरेंटरल (इंडिया) - बीएसई: 524448, NSE: N.A

एलकॉन पैरेंटरल (इंडिया)

बीएसई: 524448  |  NSE: N.A  |  ISIN: INE027C01011  |  Pharmaceuticals

खोजें एलकॉन पैरेंटरल (इंडिया) कनेक्शन मार्च 14
लेखांकन नीति साल : मार्च '15
a.  Basis of Accounting
 The financial statements of the company have been prepared in
 accordance with generally accepted accounting principles in India
 (Indian GAAP). The company has prepared these financial statements to
 comply in all material respects with the accounting standards notified
 under section 133 of the Companies Act, 2013 read together with
 paragraph 7 of the Companies (accounts) rules, 2014. The financial
 statements have been prepared under the historical cost convention on
 an accrual basis except in case of assets for which revaluation is
 carried out. The accounting policies adopted in the preparation of
 financial statements are consistent with those of previous year.
 b.  Use of estimates
 The preparation of financial statements in conformity with Indian GAAP
 requires the management to make judgments, estimates and assumptions
 that affect the reported amounts of revenues, expenses, assets and
 liabilities and the disclosure of contingent liabilities, at the end of
 the reporting period. Although these estimates are based on the
 management''s best knowledge of current events and actions, uncertainty
 about these assumptions and estimates could result in the outcomes
 requiring a material adjustment to the carrying amounts of assets or
 liabilities in future periods.
 c.  Useful lives/ depreciation rates
 Till the year ended March 31st, 2014, depreciation rates prescribed
 under Schedule XIV were treated as minimum rates and the company was
 not allowed to charge depreciation at lower rates even if such lower
 rates were justified by the estimated useful life of the asset.
 Schedule II to the Companies Act 2013 prescribes useful lives for fixed
 assets which, in many cases, are different from lives prescribed under
 the erstwhile Schedule XIV. However, Schedule II allows companies to
 use higher/ lower useful lives and residual values if such useful lives
 and residual values can be technically supported and justification for
 difference is disclosed in the financial statements.
 Considering the applicability of Schedule II, the management has re-
 estimated useful lives and residual values of all its fixed assets. The
 management believes that depreciation rates currently used fairly
 reflect its estimate of the useful lives and residual values of fixed
 assets, though these rates in certain cases are different from lives
 prescribed under Schedule II. Hence, this change in accounting policy
 did not have any material impact on financial statements of the
 d.  Revenue Recognition
 Revenue is recognized to the extent that it is probable that the
 economic benefits will flow to the Company and the revenue can be
 reliably measured.
 Sale of Goods
 Revenue is recognized when the significant risks and rewards of
 ownership of the goods have passed to the buyer. It includes excise
 duty but excludes sales return, volume discount and value added tax /
 sales tax.  Excise Duty deducted from turnover (gross) is the amount
 that is included in the amount of turnover (gross) and not the entire
 amount of liability that arose during the year.
 Revenue from the sale / Contract Packaging of goods is recognised upon
 dispatch of goods to the customers and shown net of sales tax and
 excise duty.
 In accordance with AS 9 on ''Disclosure of Revenue from Sales
 Transactions'' issued by Institute of Chartered Accountants of India,
 excise duty on turnover has been reduced from turnover in Profit & Loss
 Export Benefit
 Export Benefits constituting import duty benefits under Duty Draw Back
 & Focus Market are accounted for on accrual basis. Export benefits
 under Duty Draw Back & Focus Market are considered as other operating
 Revenue is recognised on a time proportion basis taking into account
 the amount outstanding and the rate applicable.
 Policy for Insurance Claims
 Claims receivable on account of insurance are accounted for to the
 extent the Company is reasonably certain of their ultimate collection.
 e.  Tangible fixed Assets
 Tangible fixed assets are stated at cost, less accumulated depreciation
 and impairment losses, if any. The cost comprises purchase price,
 borrowing costs if capitalization criteria are met and directly
 attributable cost of bringing the asset to its working condition for
 the intended use. Any trade discounts and rebates are deducted in
 arriving at the purchase price.
 Expenditure directly relating to construction activity is capitalized
 (net of income, if any). Indirect expenditure specifically attributable
 to construction of a project or to the acquisition of the fixed assets
 or bringing it to working condition is capitalised as part of
 Construction project or as a part of Fixed assets. Other indirect
 expenditure incurred during the construction period which is not
 related to construction activity nor is incidental thereto is charged
 to Statement of profit and loss.
 Gains or losses arising from derecognition of fixed assets are measured
 as the difference between the net disposal proceeds and the carrying
 amount of the asset and are recognized in the Statement of profit and
 loss when the asset is derecognized.
 Subsequent expenditure related to an item of fixed asset is added to
 its book value only if it increases the future benefits from the
 existing asset beyond its previously assessed standard of performance.
 All other expenses on existing fixed assets, including day-to-day
 repair and maintenance expenditure and cost of replacing parts, are
 changed to the Statement of profit and loss for the period during which
 such expenses are incurred.
 f.  Depreciation
 I.  Depreciation on fixed assets is provided using Straight Line
 Method on prorata basis at the rates and manners prescribed in schedule
 II of companies act 2013 except for the plant & Machinery.  The
 depreciation on plant & Machinery has been provided based on the useful
 life estimated by the management. The company has used the following
 rates of depreciation on plant & Machinery using straight line method.
 Useful lives estimated by the management for plant and machinery* 19
 * For these class of assets, based on internal technical assessment,
 the management believes that the useful life as given above best
 represents the period over which management expects to use the assets.
 Hence, the useful lives for these assets is different from the useful
 lives as prescribed under part C of Schedule II of the Companies Act
 2013. The life of plant and machinery is based on triple shift working.
 ii.  Leasehold land is amortized over the period of lease.
 iii.  Fixed assets costing below Rs.  5000/- are depreciated at the
 rate of 100%.
 iv.  Depreciation on the amount of additions made to fixed assets due
 to up gradations/improvements is provided over the remaining useful
 life of the asset to which it relates.
 v.  Depreciation on fixed assets added/disposed off during the year is
 provided on pro-rata basis.
 vi.  Effective from April 01st, 2014, the company has charged
 depreciation based on the revised remaining useful life of the assets
 as per the requirement of schedule II of the Companies Act 2013. Due to
 the above, depreciation charged for the year ended March 31st, 2015 is
 higher by Rs. 44,65,151/-. Further based on transitional provisions
 provided in note 7(b) of schedule II of the companies Act 2013, an
 amount of Rs. 73,87,578/- (net of deferred tax) has been adjusted with
 the retained earnings.
 g.  Intangibles
 Software costs relating to acquisition of initial software license fee
 and installation costs are capitalized in the year of purchase.
 Software''s are amortized on a straight-line basis over its useful life,
 which is considered not exceeding 10 years.
 h.  Borrowing Cost
 Borrowing cost includes interest, amortization of ancillary costs
 incurred in connection with the arrangement of borrowings. Borrowing
 costs directly attributable to the acquisition, construction or
 production of an asset that necessarily takes a substantial period of
 time to get ready for its intended use or sale are capitalized as part
 of the cost of the respective asset. All other borrowing costs are
 expensed in the period they occur.
 i.  Inventories
 Inventories are valued as follows :
 Finished goods and Work in Progress :
 Lower of cost and net realizable value. Cost includes direct materials
 and labour and a proportion of manufacturing overheads based on normal
 operating capacity. Cost of finished goods includes excise duty. Cost
 is determined on moving weighted average basis.
 Scrap : Net Realisable value
 Raw Material, Stores and Spare and others :
 Lower of cost and net realizable value. However materials and other
 items held for use in the production of inventories are not written
 down below cost if the finished products, in which they will be
 incorporated, are expected to be sold at or above cost. Cost of Raw
 materials is determined on a monthly moving weighted average basis and
 cost of stores and spares is determined on transaction moving weighted
 j.  Foreign Currency Transactions
 Initial Recognition
 Foreign currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate between
 the reporting currency and the foreign currency at the date of the
 Foreign currency monetary items are reported using the closing rate.
 Non- monetary items which are carried in terms of historical cost
 denominated in a foreign currency are reported using the exchange rate
 at the date of the transaction; and non-monetary items which are
 carried at fair value or other similar valuation denominated in a
 foreign currency are reported using the exchange rates that existed
 when the values were determined.
 Exchange Differences
 Exchange differences arising on the settlement of monetary items or on
 reporting company''s monetary items at rates different from those at
 which they were initially recorded during the year, or reported in
 previous financial statements, are recognized as income or as expenses
 in the year in which they arise .
 In terms of the Notification No. G.S.R. 225(E) dated 31.03.2009 as
 amended till date issued by the Ministry of Corporate Affairs on
 Accounting Standard (AS-11) Para 46A read with clarification issued by
 the Ministry of Corporate Affairs vide Circular No.25/2012 dated August
 09, 2012 on AS-11 relating to the effects of changes in Foreign
 Exchange Rates, the Company has exercised option to adjust the foreign
 exchange difference on long term foreign currency loans to the cost of
 qualifying capital assets. Exchange differences has also been treated
 as per Clause 4(e) of AS-16 on Borrowing Cost.
 Forward Exchange Contracts not intended for trading or speculation
 The premium or discount arising at the inception of forward exchange
 contracts is amortised as expense or income over the life of the
 contract.  Exchange differences on such contracts are recognised in the
 Statement of profit and loss in the year in which the exchange rates
 change. However for the exchange differences arising on long term
 foreign currency monetary item relating to the acquisition of fixed
 assets are adjusted with the cost of the qualifying capital assets.
 k.  Leases
 Operating Leases: Leases where the lessor effectively retains
 substantially all the risks and benefits of ownership of the leased
 item are classified as operating leases. Operating lease payments are
 recognized as an expense in the Statement of profit and loss on a
 straight-line basis over the lease term.
 l.  Income Taxes
 Tax expense comprises of current and deferred tax. Current income tax
 is measured at the amount expected to be paid to the tax authorities in
 accordance with the Income Tax Act, 1961. Deferred income taxes
 reflects the impact of current year timing differences between taxable
 income and accounting income for the year and reversal of timing
 differences of earlier years.
 Deferred tax is measured based on the tax rates and the tax laws
 enacted or substantively enacted at the balance sheet date. Deferred
 tax assets are recognised only to the extent that there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realised. If the company
 has unabsorbed depreciation and carry forward of tax losses, all
 deferred tax assets are recognised only if there is virtual certainty
 supported by convincing evidence that such deferred tax assets can be
 realised against future taxable profits.
 MAT credit is recognised as an asset only when and to the extent there
 is convincing evidence that the company will pay normal income tax
 during the specified period. In the year in which the Minimum
 Alternative tax (MAT) credit becomes eligible to be recognized as an
 asset in accordance with the recommendations contained in guidance note
 issued by the Institute of Chartered Accountants of India, the said
 asset is created by way of a credit to the Statement of profit and loss
 and shown as MAT Credit Entitlement. The Company reviews the same at
 each balance sheet date and writes down the carrying amount of MAT
 Credit Entitlement to the extent there is no longer convincing evidence
 to the effect that Company will pay normal Income Tax during the
 specified period.
 m.  Impairment of Assets
 i) The carrying amounts of assets are reviewed at each balance sheet
 date if there is any indication of impairment based on
 internal/external factors. An impairment loss is recognized wherever
 the carrying amount of an asset exceeds its recoverable amount. The
 recoverable amount is the greater of the asset''s net selling price and
 value in use. In assessing value in use, the estimated future cash
 flows are discounted to their present value a pre-tax discount rate
 that reflects current market assessment of the time value of money and
 risks specific to asset.
 ii) After impairment, depreciation is provided on the revised carrying
 amount of the asset over the remaining useful life.
 n.  Research & Development
 Revenue expenditure on research and development is recognised as
 expense in the year in which it is incurred.
 Capital expenditure on research and development is shown as addition to
 fixed assets.
 o.  Retirement and other Employee Benefits
 Retirement benefits in the form of Provident Fund (where contributed to
 the Regional Provident Fund Commissioner) and employee state insurance
 are defined contribution schemes. The Company has no obligation, other
 than the contribution payable to the respective authorities. The
 Company recognizes contribution payable to respective authorities as an
 expenditure, when an employee renders the related service. If the
 contribution payable to the scheme for service received before the
 balance sheet date exceeds the contribution already paid, the deficit
 payable to the scheme is recognized as a liability after deducting the
 contribution already paid. If the contribution already paid exceeds the
 contribution due for services received before the balance sheet date,
 then excess is recognized as an asset to the extent that the pre
 payment will lead to, for example, a reduction in future payment or a
 cash refund.
 Gratuity liability is defined benefit obligation and is provided for on
 the basis of an actuarial valuation on projected unit credit method
 made at the end of each financial year.
 Short term compensated absences are provided for based on estimates.
 Long term compensated absences are provided for based on actuarial
 valuation. The actuarial valuation is done as per projected unit credit
 method. The Company presents the leave as a current liability in the
 balance sheet, to the extent it does not have an unconditional right to
 defer its settlement for 12 months after the reporting date.
 Actuarial gains/losses are immediately taken to Statement of profit and
 loss and are not deferred.
 p.  Provisions
 A provision is recognised when an enterprise has a present obligation
 as a result of past event and it is probable that an outflow of
 resources will be required to settle the obligation, in respect of
 which a reliable estimate can be made. Provisions are not discounted to
 its present value and are determined based on best management estimate
 required to settle the obligation at the balance sheet date. These are
 reviewed at each balance sheet date and adjusted to reflect the current
 management estimates..
 q.  Segment Reporting
 Identification of segments:
 Secondary Segment
 Geographical Segment
 The activities of the Company relate to single segement i.e.
 pharmaceuticals business segment and has only one reportable segment.
 However, the analysis of Company''s revenue generation is based on the
 geographical location of its customer''s and does not have any
 identifiable ''Primary Segment'' for reporting.
 Accordingly, the geographical location segment have been considered for
 disclosure as follows:
 For Sales Revenue ;
 - Sales with in india includes Sales to customers located with in
 - Sales outside india includes Sales to customers located outside
 For Carrying Amount of Geographical Segment Assets (i.e. receivables);
 Carrying amount (receivables) of Geographical segmented assets are as
 - Receivables within India
 - Receivables outside India
 For Common Fixed Assets;
 The Company has common fixed assets for producing goods for domestic
 market and Overseas Market. Hence, segregated figures are not
 r.  Cash and Cash Equivalents
 Cash and cash equivalents in the balance sheet comprise cash at bank
 and in hand and short-term investments with an original maturity of
 three months or less.
 s.  Contingent liabilities
 A contingent liability is a possible obligation that arises from past
 events whose existence will be confirmed by the occurrence or
 non-occurrence of one or more uncertain future events beyond the
 control of the company or a present obligation that is not recognized
 because it is not probable that an outflow of resources will be
 required to settle the obligation. A contingent liability also arises
 in extremely rare cases where there is a liability that cannot be
 recognized because it cannot be measured reliably.  The company does
 not recognize a contingent liability but discloses its existence in the
 financial statements.
 t Earnings Per Share
 Basic earnings per share are calculated by dividing the net profit or
 loss for the year attributable to equity shareholders (after deducting
 preference dividends and attributable taxes) by the weighted average
 number of equity shares outstanding during the period.
 For the purpose of calculating diluted earnings per share, the net
 profit or loss for the year attributable to equity shareholders and the
 weighted average number of shares outstanding during the period are
 adjusted for the effects of all dilutive potential equity shares.
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