Accounting Policies of Dr. Datsons Labs Ltd. Company

Mar 31, 2014

A. Basis of Accounting:-

The Financial Statements of the Company are prepared under historical cost convention and on accrual basis and in accordance with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act 1956. Accounting policies, not specifically referred to hereunder is otherwise consistent with generally accepted accounting polices ["GAAP"].

b. Fixed Assets:-

Fixed Assets are stated at cost of acquisition inclusive of non refundable duties and taxes, freight and incidental expenses, if any. Cost of fixed assets not ready for their intended use before such date are disclosed under capital work in progress.

c. Depreciation:-

Depreciation on Fixed Assets is provided on Straight Line Method at the rates specified in schedule XIV of the Companies Act, 1956.Depreciation on additions made to fixed assets during the year is provided on pro-rata basis.

d. Valuation of Inventories:-

i. Raw Materials (including packing material) are valued at cost or net, realizable value whichever is lower. Cost is determined by using the First In First out (FIFO) method.

ii. Semi Finished Goods (Work in progress) are valued at cost.

iii. Finished Goods:

Manufactured goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First In First out (FIFO) method. Cost includes cost of raw materials used and all the related overhead expenses.

Traded Goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First in First out (FIFO) method.

e. Revenue Recognition:-

- The Company follows the mercantile system of accounting and hence Revenue is recognized by the company on accrual basis.

- Interest income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable. Interest income is accrued at applicable interest rate.

- Export Benefits / incentives and other incomes are accounted on accrual basis except Dividend, which recognized when right to receive is established.

f. Segment Accounting

1. Segment accounting policies:

Segment accounting policies are in line with the accounting policies of the Company. In addition, the following specific accounting policies have been followed for segment reporting:

1. Segment revenue includes sales and other income directly identifiable with/allocable to the segment including inter-segment revenue.

2. Expenses that are directly identifiable with/allocable to segments are considered for determining the Segment Result. Expenses, which relate to the Company as a whole and not allocable to segments are included under "Unallocable Corporate Expenditure".

3. Income which relates to the Company as a whole and not allocable to segments is included in "Unallocable Corporate Income".

4. Segment result includes margins on inter-segment transactions, which are reduced in arriving at the profit before tax of the Company.

5. Segment assets and liabilities include those directly identifiable with the respective segments. Unallocable corporate assets and liabilities represent the assets and liabilities that relate to the Company as a whole and not allocable to any segment.

2. Inter-segment transfer pricing:

Segment revenue resulting from transactions with other business segments is accounted on the basis of transfer price agreed between the segments. Such transfer prices are either determined to yield a desired margin or agreed on a negotiated basis.

g. Accounting for Foreign Exchange Transaction:-

In accordance with Companies (Accounting Standards) Rules, 2006 the transaction in foreign exchange are accounted for at the exchange rates prevailing at the date of the transaction. In respect of the Assets and Liabilities remaining unsettled at the Balance sheet date same are translated at the closing rate. Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date are recognized as income or expense in the period in which they arise.

Where the company uses derivative financial instruments such as forward contracts to hedge its risk associated against foreign currency fluctuations, the Gain or loss on restatement of such contracts outstanding at the balance sheet date are recognized in the profit and loss account for the year in which it occurs. The premium or discount arising at the inception of forward contracts is amortized through the profit and loss account over the period of the contract.

h. Leases:

Lease arrangements, where the risk and rewards incidental to the ownership of asset substantially vests with the lessor are recognized as operating lease. Lease payments under operating leases are recognized as an expense in the Profit and Loss Account. Assets leased out under operating leases are capitalized. Rental income is recognized on accrual basis over the lease term.

i. Taxation:-

Tax expenses is the aggregate of current tax and deferred tax charged, as the case may be to the Profit and Loss Account for the year in accordance with Companies (Accounting Standards) Rules, 2006 and measured at the tax rate that have been enacted or substantively enacted by the Balance Sheet date.

I. Current Tax:

Tax on income for the current period is determined on the basis of assessable income computed in accordance with the provisions of the Income Tax Act, 1961.

II. Deferred Tax:

Deferred income taxes are recognized for the future tax consequences attributable to timing difference between the financial statements and determination of income for their recognition for tax purposes. The effect on deferred tax liabilities of a charge in tax rates is recognized in income using the rates and tax laws that have been enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognized and carried forward to the extent there is reasonable certainty that sufficient future taxable income will be available against which deferred tax assets can be realized.

j. Contingent Liability:-

Contingent liabilities, if any, are disclosed in the Notes to Accounts. Provisions have been made in the accounts in respect of those contingencies which are likely to materialize into liabilities after the year end till the finalization of accounts and have a material effect on the position stated in the Balance Sheet.

k. Borrowing Cost:-

Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of cost of such asset till such time as the asset is ready for its intended use. All other borrowing costs are expensed in the period in which they are incurred.

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Mar 31, 2013

A. Basis of Accounting:- The Financial Statements of the Company are prepared under historical cost convention and on accrual basis and in accordance with the Accounting Standards notifed by the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. Accounting policies, not specifcally referred to hereunder is otherwise consistent with generally accepted accounting polices ["GAAP"].

b. Fixed Assets:- Fixed Assets are stated at cost of acquisition inclusive of non refundable duties and taxes, freight and incidental expenses, if any. Advances paid towards acquisition/construction of fxed assets outstanding at each balance sheet date and cost of fxed assets not ready for their intended use before such date are disclosed under capital work in progress.

c. Depreciation:- Depreciation on Fixed Assets is provided on Straight Line Method at the rates specifed in schedule XIV of the Companies Act, 1956. Depreciation on additions made to fxed assets during the year is provided on pro-rata basis.

d. Valuation of Inventories:- i. Raw Materials are valued at cost or net, realisable value whichever is lower. Cost is determined by using the First in First out (FIFO) method.

ii. Semi Finished Goods (Work in progress) are valued at cost.

iii. Finished Goods:

Manufactured goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First In First out (FIFO) method. Cost includes cost of raw materials used and all the related overhead expenses.

Traded Goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First in First out (FIFO) method.

e. Revenue Recognition:- The Company follows the mercantile system of accounting and hence Revenue is recognised by the Company on accrual basis.

f. Pre-Operative Expenditure :- Pre-Operative expenses of the Company have been fully written of in the year of commencement of commercial operations. The Company was incorporated on 3rd January, 2006 and commenced Commercial operations on 25th September, 2007.

g. Accounting for Foreign Exchange Transaction:- In accordance with Companies (Accounting Standards) Rules, 2006 the transaction in foreign exchange are accounted for at the exchange rates prevailing at the date of the transaction. In respect of the Assets and Liabilities remaining unsettled at the Balance sheet date are translated at the closing rate. Exchange diferences that arise on settlement of monetary items or on reporting at each balance sheet date are recognised as income or expense in the period in which they arise.

Where the Company uses derivative fnancial instruments such as forward contracts to hedge its risk associated against foreign currency fuctuations, the Gain or loss on restatement of such contracts outstanding at the balance sheet date are recognised in the proft and loss account for the year in which it occurs. The premium or discount arising at the inception of forward contracts is amortised through the proft and loss account over the period of the contract.

h. Taxation:- Tax expenses is the aggregate of current tax and deferred tax charged, as the case may be to the Proft and Loss Account for the year in accordance with Companies (Accounting Standards) Rules, 2006 and measured at the tax rate that have been enacted or substantively enacted by the Balance Sheet date.

I. Current Tax:

Tax on income for the current period is determined on the basis of assessable income computed in accordance with the provisions of the Income Tax Act, 1961.

II. Deferred Tax:

Deferred income taxes are recognised for the future tax consequences attributable to timing diference between the fnancial statements and determination of income for their recognition for tax purposes. The efect on deferred tax liabilities of a charge in tax rates is recognised in income using the rates and tax laws that have been enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognised and carried forward to the extent there is reasonable certainty that sufcient future taxable income will be available against which deferred tax assets can be realised.

i. Contingent Liability:- Contingent liabilities, if any, are disclosed in the Notes to Accounts. Provisions have been made in the accounts in respect of those contingencies which are likely to materialise into liabilities after the year end till the fnalisation of accounts and have a material efect on the position stated in the Balance Sheet.

j. Borrowing Cost:- Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of cost of such asset till such time as the asset is ready for its intended use. All other borrowing costs are expensed in the period in which they are incurred.

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Mar 31, 2012

A. Basis of Accounting:-

The Financial Statements of the Company are prepared under historical cost convention and on accrual basis and in accordance with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. Accounting policies, not specifically referred to hereunder is otherwise consistent with generally accepted accounting polices ["GAAP"].

b. Fixed Assets:-

Fixed Assets are stated at cost of acquisition inclusive of non refundable duties and taxes, freight and incidental expenses, if any. Advances paid towards acquisition/construction of fixed assets outstanding at each balance sheet date and cost of fixed assets not ready for their intended use before such date are disclosed under capital work in progress.

c. Depreciation:-

Depreciation on Fixed Assets is provided on Straight Line Method at the rates specified in schedule XIV of the Companies Act, 1956.Depreciation on additions made to fixed assets during the year is provided on pro-rata basis.

d. Valuation of Inventories:-

i. Raw Materials are valued at cost or net, realisable value whichever is lower. Cost is determined by using the First In First out (FIFO) method.

ii. Semi Finished Goods (Work in progress) are valued at cost.

iii. Finished Goods:

Manufactured goods are valued at cost or net realizable value whichever is lower. Cost is determined by using the First In First out (FIFO) method. Cost includes cost of raw materials used and all the related overhead expenses.

Traded Goods are valued at cost or net realizable value whichever is lower. Cost is determined by using the First in First out (FIFO) method.

e. Revenue Recognition:-

The Company follows the mercantile system of accounting and hence Revenue is recognized by the company on accrual basis.

f. Pre-Operative Expenditure & IPO Expenses :-

Pre-Operative expenses of the Company have been fully written off in the year of commencement of commercial operations. IPO issue expenses have been set off against Share Premium account .The Company was incorporated on 3rd January, 2006 and commenced Commercial operations on 25th September, 2007.

g. Accounting for Foreign Exchange Transaction:-

In accordance with Companies (Accounting Standards) Rules, 2006 the transaction in foreign exchange are accounted for at the exchange rates prevailing at the date of the transaction. In respect of the Assets and Liabilities remaining unsettled at the Balance sheet date are translated at the closing rate. Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date are recognized as income or expense in the period in which they arise.

Where the company uses derivative financial instruments such as forward contracts to hedge its risk associated against foreign currency fluctuations, the Gain or loss on restatement of such contracts outstanding at the balance sheet date are recognized in the profit and loss account for the year in which it occurs. The premium or discount arising at the inception of forward contracts is amortized through the profit and loss account over the period of the contract

h. Taxation:-

Tax expenses is the aggregate of current tax and deferred tax charged, as the case may be to the Profit and Loss Account for the year in accordance with Companies (Accounting Standards) Rules, 2006 and measured at the tax rate that have been enacted or substantively enacted by the Balance Sheet date.

I. Current Tax

Tax on income for the current period is determined on the basis of assessable income computed in accordance with the provisions of the Income Tax Act, 1961.

II. Deferred Tax

Deferred income taxes are recognized for the future tax consequences attributable to timing difference between the financial statements and determination of income for their recognition for tax purposes. The effect on deferred tax liabilities of a charge in tax rates is recognized in income using the rates and tax laws that have been enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognized and carried forward to the extent there is reasonable certainty that sufficient future taxable income will be available against which deferred tax assets can be realized.

i. Contingent Liability:-

Contingent liabilities, if any, are disclosed in the Notes to Accounts. Provisions have been made in the accounts in respect of those contingencies which are likely to materialize into liabilities after the yearend till the finalization of accounts and have a material effect on the position stated in the Balance Sheet.

j. Borrowing Cost:-

Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of cost of such asset till such time as the asset is ready for its intended use. All other borrowing costs are expensed in the period in which they are incurred.

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Mar 31, 2011

The Financial Statements of the Company are prepared under historical cost convention and on accrual basis and in accordance with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act 1956. Accounting policies, not specifically referred to hereunder is otherwise consistent with generally accepted accounting polices ["GAAP"].

b. Fixed Assets:-

Fixed Assets are stated at cost of acquisition inclusive of non refundable duties and taxes, freight and incidental expenses, if any. Advances paid towards acquisition/construction of fixed assets outstanding at each balance sheet date and cost of fixed assets not ready for their intended use before such date are disclosed under capital work in progress.

c. Depreciation.-

Depreciation on Fixed Assets is provided on Straight Line Method at the rates specified in schedule XIV of the Companies Act, 1956.Depreciation on additions made to fixed assets during the year is provided on pro-rata basis.

d. Valuation of Inventories:-

i. Raw Materials are valued at cost or net, realizable value whichever is lower. Cost is determined by using the First In First out (FIFO) method.

ii. Semi Finished Goods (Work in progress) are valued at cost.

iii. Finished Goods:

Manufactured goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First In First out (FIFO) method. Cost includes cost of raw materials used and all the related overhead expenses. Traded Goods are valued at cost or net realisable value whichever is lower. Cost is determined by using the First in First out (FIFO) method.

e. Revenue Recognition:-

The Company follows the mercantile system of accounting and hence Revenue is recognized by the company on accrual basis.

f. Pre-Operative Expendiiure:-

Pre-Operative expenses of the Company have been fully written off in the year of commencement of commercial operations. The Company was incorporated on 3rd January, 2006 and commenced Commercial operations on 25th September, 2007.

g. Accounting for Foreign Exchange Transaction:-

In accordance with Companies (Accounting Standards) Rules, 2006 the transaction in foreign exchange are accounted for at the exchange rates prevailing at the date of the transaction. In respect of the Assets and Liabilities remaining unsettled at the Balance sheet date are translated at the closing rate. Exchange differences that arise on settlement of monetary items or on reporting at each balance sheet date are recognized as income or expense in the period in which they arise.

h. Taxation:-

Tax expenses is the aggregate of current tax and deferred tax charged, as the case may be to the Profit and Loss Account for the year in accordance with Companies (Accounting Standards) Rules, 2006 and measured at the tax rate that have been enacted or substantively enacted by the Balance Sheet date.

I. Current Tax

Tax on income for the current period is determined on the basis of assessable income computed in accordance with the provisions of the Income Tax Act, 1961.

II. Deferred Tax

Deferred income taxes are recognized for the future tax consequences attributable to timing difference between the financial statements and determination of income for their recognition for tax purposes. The effect on deferred tax liabilities of a charge in tax rates is recognized in income using the rates and tax laws that have been enacted or substantively enacted as on the Balance Sheet date. Deferred tax assets are recognized and carried forward to the extent there is reasonable certainty that sufficient future taxable income will be available against which deferred tax assets can be realized.

i. Contingent Liabilitv:-

Contingent liabilities, if any, are disclosed in the Notes to Accounts. Provisions have been made in the accounts in respect of those contingencies which are likely to materialize into liabilities after the year end till the finalization of accounts and have a material effect on the position stated in the Balance Sheet.

j. Borrowing Cost:-

Borrowing costs that are attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of cost of such asset till such time as the asset is ready for its intended use. All other borrowing costs are expensed in the period in which they are incurred.