Notes to Accounts of Span Divergent Ltd.

Mar 31, 2024

(j) Provisions
General

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow
of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised
as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit
and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

(k) Employee Benefits

a. Retirement Benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation, other than the contribution
payable to the provident fund. The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders
the related service.

The Company operates a defined benefit gratuity plan in India, which requires contributions to be made to a separately administered fund.

The cost of providing benefits under the defined benefit plan is determined based on actuarial valuation.

Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined
benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised
immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur.
Remeasurements are not reclassified to profit or loss in subsequent periods.

Past service costs are recognised in profit or loss on the earlier of:

- The date of the plan amendment or curtailment, and

- The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company recognises the following changes in
the net defined benefit obligation as an expense in the statement of profit and loss.

- Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements; and

- Net interest expense or income

b. Compensated Expenses

The Company treats accumulated leave, as a long-term employee benefit for measurement purposes. Such long-term compensated absences are
provided for based on an actuarial valuation using the projected unit credit method at the period-end/ year-end. Actuarial gains/losses are immediately
taken to the statement of profit and loss and are not deferred. The Company presents the entire liability in respect of leave as a current liability in the
balance sheet, since it does not have an unconditional right to defer its settlement beyond 12 months after the reporting date.

c. Other Short-term benefits

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period
in which the employees render the related service are recognised in respect of employees’ services up to the end of the reporting period and are
measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in
the balance sheet.

(l) Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.
Financial assets

Initial recognition and measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction
costs that are attributable to the acquisition of the financial asset.

Subsequent measurement

For purposes of subsequent measurement, a ‘debt instrument’ is measured at the amortised cost if both the following conditions are met:

a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and

b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal
amount outstanding.

This category is the most relevant to the Company. After initial measurement, such financial assets are subsequently measured at amortised cost
using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees
or costs that are an integral part of the EIR. The EIR amortisation is included in finance income in the profit or loss. The losses arising from
impairment are recognised in the profit or loss. This category generally applies to trade and other receivables.

Equity investments:

In respect of equity investments, when an entity prepares separate financial statements, Ind AS 27 requires it to account for its investments in
subsidiaries and associates either:

(a) at cost; or

(b) in accordance with Ind AS 109.

If a first-time adopter measures such an investment at cost in accordance with Ind AS 27, it shall measure that investment at one of the following
amounts in its separate opening Ind AS Balance Sheet:

(a) cost determined in accordance with Ind AS 27; or

(b) deemed cost. The deemed cost of such an investment shall be its:

(i) fair value at the entity’s date of transition to Ind ASs in its separate financial statements; or

(ii) previous GAAP carrying amount at that date.

A first-time adopter may choose either (i) or (ii) above to measure its investment in each subsidiary or associate that it elects to measure using a
deemed cost.

Since the company is a first-time adopter it has measured its investment in subsidiary and associate at deemed cost in accordance with Ind AS 27
by taking previous GAAP carrying amount.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed
from the Company’s balance sheet) when:

a) the rights to receive cash flows from the asset have expired, or

b) the Company has transferred its rights to receive cash flows from the asset, and

i. the Company has transferred substantially all the risks and rewards of the asset, or

ii. the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the
following financial assets and credit risk exposure:

a) Financial assets that are debt instruments, and are measured at amortised cost e.g., loans, debt securities, deposits, trade receivables and bank
balance

b) Trade receivables or any contractual right to receive cash or another financial asset that result from transactions that are within the scope of Ind
AS 18

c) Loan commitments which are not measured as at FVTPL

The Company follows ‘simplified approach’ for recognition of impairment loss allowance on trade receivables

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance
based on lifetime ECLs at each reporting date, right from its initial recognition.

For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant
increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month ECL is used to provide for impairment loss.
However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such
that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12-month
ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

ECL is the difference between all contractual cash flows that are due to the Company in accordance with the contract and all the cash flows that the
entity expects to receive (i.e., all cash shortfalls), discounted at the original EIR. When estimating the cash flows, an entity is required to consider:

? All contractual terms of the financial instrument (including prepayment, extension, call and similar options) over the expected life of the
financial instrument. However, in rare cases when the expected life of the financial instrument cannot be estimated reliably, then the entity is
required to use the remaining contractual term of the financial instrument

? Cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/ expense in the statement of profit and loss (P&L).
This amount is reflected under the head ‘other expenses’ in the P&L. The balance sheet presentation for various financial instruments is described
below:

? Financial assets measured as at amortised cost: ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in
the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce
impairment allowance from the gross carrying amount.

? Loan commitments and financial guarantee contracts: ECL is presented as a provision in the balance sheet, i.e. as a liability.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or
as derivatives designated as hedging instruments in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable
transaction costs.

The Company’s financial liabilities include trade and other payables, loans and borrowings, financial guarantee contracts.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

Loans and borrowings

This is the category most relevant to the Company. After initial recognition, interest-bearing loans and borrowings are subsequently measured at
amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the
EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The
EIR amortisation is included as finance costs in the statement of profit and loss.

This category generally applies to borrowings. For more information refer Note 14.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability
is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an
exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective
carrying amounts is recognised in the statement of profit or loss.

Reclassification of financial assets

The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made
for financial assets which are equity instruments and financial liabilities. If the Company reclassifies financial assets, it applies the reclassification
prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model.
The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

(m) Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months
or less, which are subject to an insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding
bank overdrafts as they are considered an integral part of the Company’s cash management.

(n) Segment Reporting

The Board of Directors assess the financial performance of the Company and make strategic decisions and has been identified as being the Chief
Operating Decision Maker (CODM). Based on the internal reporting provided to the CODM, the Company has only one reportable segment i.e. the
activities of head offices, Management services, hence no separate disclosures are reauired under Ind As 108

(o) Leases

Assets acquired on lease and assets given on lease where a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases. The initial direct cost of lease is charged to Statement of Profit and Loss as and when incurred. Lease rental are charged
to Statement of Profit and loss on accrual basis.

(p) Earnings per Share

The Basic earning per Share ("EPS") is computed by dividing the net profit/(loss) after tax for the year attributable to equity share holder by the
weighted average number of equity shares outstanding during the year.

Diluted earnings per share is calculated by dividing the net profit after tax for the period attributable to the equity shareholders of the Company by
weighted average number of equity shares determined by assuming conversion on exercise of conversion rights for all potential dilutive securities.

(q) Additional regulatory information

(a) The Company did not have any material transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of
Companies Act, 1956 during the financial year or The Company does not have any transactions with companies struck off.

(b) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

(c) The Company has not traded or invested in crypto currency or virtual currency during the year.

Note 20: Capital management
Risk management

For the purpose of the Company''s capital management, capital includes issued equity capital, compulsorily convertible preference shares, share
premium and all other equity reserves attributable to the equity holders. The primary objective of the Company’s capital management is to maximise
the shareholder value. The Company manages its capital structure in consideration to the changes in economic conditions and the requirements of
the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company
includes within net debt, borrowings including interest accrued on borrowings, trade and other payables, less cash and short-term deposits.

Note 23: Financial Risk Management Framework
Risk management framework

The Company is exposed primarily to Credit Risk, Liquidity Risk and Market risk, which may adversely impact the fair value of its financial
instruments. The Company assesses the unpredictability of the financial environment and seeks to mitigate potential adverse effects on the financial
performance of the Company.

Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss.
Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risks. Credit
risk is controlled by analyzing credit limits and creditworthiness of customers on a continuous basis to whom the credit has been granted after
obtaining necessary approvals for credit. Financial instruments that are subject to concentrations of credit risk principally consist of trade
receivables, investments, derivative financial instruments, cash and cash equivalents, bank deposits and other financial assets. None of the financial
instruments of the Company result in material concentration of credit risk.

Trade receivables

Ind AS requires expected credit losses to be measured through a loss allowance. The Company assesses at each date of statements of financial
position whether a financial asset or a group of financial assets is impaired. Expected credit losses are measured at an amount equal to the 12 month
expected credit losses or at an amount equal to the life time expected credit losses if the credit risk on the financial asset has increased significantly
since initial recognition. The Company has used a practical expedient by computing the expected credit loss allowance for trade receivables based
on a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forward-looking information.
Company’s exposure to customers is towards related parties and not subject to significant credit risk based on past history.

Current Investment

The Company holds current investment in mutual funds at 31 March 2024 and 31 March 2023. The credit risk on mutual funds is limited.

Cash and cash equivalents

The Company holds cash and cash equivalents. The credit risk on liquid funds is limited.

Liquidity Risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk management is to maintain
sufficient liquidity and ensure that funds are available for use as per requirements. The Company manages liquidity risk by maintaining adequate
reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity
profiles of financial assets and liabilities.

Note 26: Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in
active markets, their fair value is measured using valuation techniques including the DCF model. The inputs to these models are taken from
observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements
include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the
reported fair value of financial instruments.

The management assessed that cash and cash equivalents, trade receivables, trade payables and other current liabilities approximate their carrying
amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction
between willing parties, other than in a forced or liquidation sale.

Note 28: Exceptional items

In case of subsidiary:

(a) Aranya Agri Biotech LLP had accumulated losses of Rs. 14.91 Crores till March 31 2023 and Rs. 0. 19 crore in the current year up to March 31,
2024. In light of the accumulated losses and business scenario going forward, Board has approved the plan for discontinuation of operations of the LLP
and the Assets of the LLP have been transfer to Asset held for sale w.e.f Quarter ended September-2023.

(b) Biospan Scientific LLP had accumulated losses of Rs.1.57 Crores as at 31st March 2019, resulting in substantial erosion of the net worth of the
LLP. Hence the Management had decided to impair the investment and Rs. 1.83 Crores were provided in the books of the Company and was treated as
an exceptional item during the year 2018-19. Notwithstanding the above, the financial results of the LLP has been prepared on going concern basis as

Management is exploring the possibilities to revive the LLP on its own or by entering in to business tie-ups and it endeavours to be able to establish
profitable operation.

(c) Biospan Contamination Control Solution Pvt Ltd had accumulated losses of Rs.5.71 Crores till March 31, 2024. As on that date the subsidiary
Company’s total liabilities exceeded its total assets by Rs. 5.61 Crores. Notwithstanding the above, the financial results of the subsidiary Company has
been prepared on going concern basis as Management believes that the company would be able to establish profitable operation and the losses incurred
is attributable to factors of temporary nature. Further, Management is confident that with appropriate product license, the Company will achieve adequate
revenue and negative net worth would turn positive by 2025.

Note 29: Lease accounting as per Ind AS 116

Effective April 1,2019, the Company has adopted Ind AS 116, Leases and applied the standard to its Leases using the modified retrospective approach.
Accordingly, the Company has not restated comparative information.

This has resulted in recognising a lease liability measured at present value of the remaining lease payments and a corresponding Right-of-Use (ROU)
asset as if the lease has been commenced w.e.f. 1st April 2019. The Company discounted remaining lease payments using the lessee’s incremental
borrowing rate as at 1 st April 2019. The Company has also elected not to apply the requirements of Ind AS 116 to short term leases and leases for which
underlying asset is of low value. In the results for the current period, the nature of expenses in respect of Operating lease has changed from lease rent
in previous periods to depreciation cost for the right-of-use asset and finance cost for interest accrued on lease liability.

Note 30:

In pursuance to Section 115BAA of the Income Tax Act, 1961 announced by Government of India through Taxation Laws (Amendment) Ordinance,
2019, the Company has an irrevocable option of shifting to a lower tax rate along with consequent reduction in certain tax incentive including additional
depreciation and accumulated depreciation. The Company is evaluating this option and continues to recognise the taxes on income for the year ended
31st March 2024 as per the earlier provisions.

As per our report of even date

For Y B Desai & Associates ^{For and on behalf of the Board of Directors}

Chartered Accountants Span Divergent Limited

Firm Registration No: 102368W

Viral P Desai Dr. Pradip K Desai

Managing Director Director

_ DIN: 00029219 DIN: 00026451

Mayank Y Desai

^Partner Paras Desai Urvi Shinde

^Membership Na ¹⁰⁸³¹⁰ Whole time Director & CFO Company Secretary

UDIN: 24108310BKALNS3907 DIN: 08293906

Date: May 16, 2024 Date: May 16, 2024

Place: Surat Place: Surat

---

Mar 31, 2015

1. Corporate Information

Span Diagnostics Limited is Public Company domiciled in India and incorporated under the provisions of the Companies Act, 2013. Its shares are listed on Bombay Stock Exchange in India. The Company was engaged in the business of manufacturing, marketing and trading of diagnostics reagents, diagnostics instruments and allied products till March 04, 2015. The Company has sold it's In-Vitro Diagnostics business on March 05, 2015. The Company is evaluating various business options for developing of new business line.

2.1 Of the above 3,638,000 Equity shares of Rs.10/- each have been allotted as fully paid-up bonus shares in year 2010-11 bycapitalizing Rs. 3,63,80,000 out of Securities premium.

2.2 There was no increase in Capital during the current year. However, during the year 2010-11,165,250 equity shares each of Rs. 10 were issued on a preferential basis by the company at a premium of Rs. 29.97 each aggregating to Rs. 6,605,042. Further 3,638,000 equity shares of Rs 10 each were issued in the year 2010-11 as bonus shares in ratio of 1:1 by capitalizing securities premium which in aggregate amounts to Rs 36,380,000.

3.1 Term Loan from banks other than Vehicle Loans were secured by hypothecation of plant and machineries, some of moveable properties of the company, equitable mortgage of some of the immovable properties of the company. Vehicle loans of Rs. NIL (Previous Year: Rs. 164,929) were secured by hypothecation of respective vehicles.

3.2 Term Loan from other parties and deferred payment liabilities were secured by hypothecation of moveable assets including Plant and Machinery and equipments which has been procured through utilization of earmarked funds and intangibles to be generated from projects.

3.3 Secured Loans were guaranteed by some of the Directors of the company & Mrs. Lata PDesai.

3.4 Deposits includes deposits from Related Parties of Rs. NIL (Previous year Rs. 4,040,000) (Refer Note 31) carrying rate of interest as per standard norms of deposits.

4.1 As per the information available with the Company, there is no amount outstanding to the parties covered under the provisions of Micro, Small and Medium Enterprises Development Act, 2006, hence, no disclosure is required under the said Act. The same has been relied upon by the auditors.

5.1 Land Cost includes Rs.950/- being the cost of 19 shares fully paid up of Rs.50/- each of Udhna Udyognagar Sahakari Sangh Ltd., Udhna.

5.2 Leasehold land cost includes cost of land allotted by G.I.D C. on lease. This lease is for 99 years and same is treated as perpetual lease hence no amortisation is done

5.3 In accordance with AS-16 relateo 'c. Borrowing costs which amounts to Rs. 1,71,142 has been capitalized during the year (Previous year Rs. 11,75,812).

5.4 The management of the Company has identified tangible fixed assets and their major components and has reviewed/determined their remaining useful lives. Accordingly, the depreciation on tangible fixed assets is provided for in accordance with the provisions of Schedule II to the Companies Act, 2013. In respect of assets where the remaining useful life is 'Nil', their carrying amount (net of tax effect) after retaining the residual value as on 1st April, 2014 as determined by the management has been adjusted against the opening balance of retained earnings Rs. 10,11,025 (Net of Tax) as on that date. Because of change in useful life as

6.1 EMPLOYEE BENEFITS

Disclosures pursuant to Accounting Standard - 15 (Revised)' Employee Benefits'

7 CONTINGENT LIABILITIES AND COMMITMENTS

A Contingent Liabilities

As at 31-03-2015 As at 31-03-2014 - Particulars

a) Taxes Rs. Rs.

(1) Sales tax

Demands under contest 837,838 837,838

C-Form Pending 3,940,707 3,091,000

(2) Income tax

Demands under dispute 21,607,889 21,607,889

b) Claims against the Company not acknowledged as Debts 2,542,704 2,542,704

c) On account of guarantees given by the bank on behalf of the company in favor of customs and others 19,281,311 53,878,577

d) The Company has imported material under the Advance Authorization Scheme of the Government of India, - 77,392 at concessional rates of customs duty by undertaking obligations to export certain quantity of specified products, For the future outstanding export obligations quantity under the Scheme as at 31-03-2014, which if not fulfilled may result in custom duty liability of

8 RELATED PARTY DISCLOSURES

Related party Disclosures as required by AS-18 are given below.

A: Relationship

(I) Related parties where control exists.

Span Biotronics Pvt. Ltd. (Subsidiary) (Upto March 04, 2015)

Span Diagnostics SA. (Pty.) Ltd. - (Subsidiary)

Span Nihon Kohden Diagnostics Pvt. Ltd. (Joint Venture)

(ii) Key Management Personnel:

Dr. Pradip K. Desai (Upto March 04, 2015) Mr. Veeral P. Desai

Ms. Sujata V. Desai (Upto March 04, 2015)

(iii) Relatives of key management personnel and their enterprise, where transactions have taken Place.

Ms. Lata P. Desai Ms. Tejal V. Desai Ms. Shital S. Kazi Mr. Prakash K. Desai Shri. Pradip. K. Desai HUF Dr. Harshad R. Gandhi Ms. Kokila H. Gandhi Dr. Udai D. Desai

Dr. Pradip K. Desai (From March 05, 2015)

Ms. Sujata V. Desai (From March 05, 2015)

(iv) Enterprise over which persons described in (ii). (iiil above is able to exercise significant influence.

Span Diagnostics SARL Quest Biochemicals Pvt. Ltd Desai Agri Bio-tech Pvt. Ltd Span Biotherapeutics Pvt Ltd

Note: Related party relationship on the basis of the requirements of Accounting Standard 18 as in 1 (i) to (iv) above is identified and certified by the Management and relied upon by the Auditors. ^

Disclosure in Respect of Material Related Party Transactions during the year:

a) Sales of goods and material includes sales to Span Biotronics Pvt. Ltd. Rs. NIL (Previous Year Rs. 344,400)

b) Purchase/ materials consumed from Span Nihon Kohden Diagnostics Pvt. Ltd.- NIL (Previous year-Rs.52,362) Span Diagnostics SARL Rs. 317,750 (Previous year- Rs. 177,200)

c) Payment to Key Management Personnel include to Dr.Pradeep K. Desai Rs. 6,039,104 ( Previous Year Rs.4,164,600), Shri Veeral P. Desai Rs.5,761,050 ( Previous Year Rs.4,278,800 ), Dr. Madhukanta T. Patel -NIL( Previous Year Rs.572,463 ), Ms. Sujata V. Desai Rs.4,119,259 (Precious Year Rs.3,233,600), Payment of appreciation to Sujata V. Desai Rs.700,000(Previous Year- Rs.NIL)

(Note : Amount mentioned here includes expesne related to Gratuity & Leave encashment. However, amount attributable to each Key Management Personnel is not available as provision for Gratuity & Leave Encashment is made based on Acturial Valuation.)

d) Interest on F.D./Loan includes Dr. M. T. Patel Rs.- NIL (Previous Year Rs.117,165), Mr.Veeral P. Desai Rs.34,116 (Previous Year Rs. 19,130), Dr.Pradeep K. Desai Rs. 89,228 (Previous Year Rs.97,315), Ms.Sujata V. Desai Rs.33,184 (Previous Year Rs.16,129 ), Mrs. Shital S. Kazi Rs.22,199 (Previous Year Rs.23,000 ), Mrs. Tejal V.Desai Rs.57,735 (Previous Year Rs.117,233 ), Dr.Harshad R.Gandhi Rs.101,515(Previous Year Rs. 103,024), Mrs.Kokila H. Gandhi Rs.129,659 (Previous Year Rs. 143,202), Shri Sunil T. Patel Rs.NIL(PreviousYear Rs.8,617), Desai Agri Bio-Tech Pvt.Ltd. Rs. 309,764(Previous Year Rs.234,312) Dr. Uday D Desai Rs.7479(Previous year- Rs.-NIL)

e) Rent paid to Mrs.Shital S.Kazi Rs. 44,516( Previous Year Rs.48,000), Mr. Veeral Desai- Rs.35,000(Previous year Rs.-NIL), Ms. Sujata Desai- Rs.35,000(PreviousyearRs.- NIL)

f) Dividend Paid to Dr.Pradeep K. Desai Rs.NIL( Previous Year Rs.653,440 ), Shri Veeral P. Desai Rs.NIL( Previous Year Rs.262,316), Dr.MadhubenT. Patel Rs.NIL( Previous Year Rs.26,080), Ms. Sujata V. Desai Rs.NIL( Previous Year Rs.50,788), Mrs. Lataben P. Desai Rs.NIL( Previous Year Rs.358,530), Mrs.Shital S. Kazi Rs.NIL( Previous Year Rs.19,750), Mrs.Tejal V. Desai Rs.NIL( Previous Year Rs.5,000), Shri Prakash K. Desai Rs.NIL( Previous Year Rs.13,500), Shri Sunil T. Patel Rs.NIL( Previous Year Rs.5,000), Mrs.Sudhaben I. Patel Rs.NIL( Previous Year Rs.5,000)

g) Gardening Expense paid to Desai Agri Bio-Tech Pvt. Ltd. Rs. 619,300 (Previous Year Rs.720,000).

h) Evaluation & Testing Charges paid to Quest Biochemicals Pvt. Ltd. Rs.30,000 (Previous Year Rs.262,000).

i) Sales and Distribution Expenses include amount Paid to Span Diagnostics SA. (Pty.) Ltd .Rs. 1,331,326 (Previous Year Rs.2,141,399).

j) Royalty paid to Span Diagnostics SARL Rs.1,712,738 (Previous Year Rs..1,232,220), Span Biotronics Pvt.Ltd Rs.401,687 (Previous Year Rs. .488,849)

k) License Fees from Span Nihon-Kohden Pvt. Ltd. Rs.1,777,903 (Previous Year Rs.2,190,000)

l) Other Income from Span Biotronics Pvt Ltd Rs.873,826 (Previous Year Rs.1,034,793),Span Diagnostics SA. (Pty.) Ltd. Rs.125,862(Previous Year Rs. 137,963), Dividend from Span Nihon Kohden Diagnostics Pvt. Ltd. Rs. NIL (Previous Year Rs 3,600,000), Dividend from Span Biotronics Pvt. Ltd. Rs.NIL (Previous Year Rs.340,411)

m) Deposits received includes from Shri Veeral P. Desai Rs.500,000 (Previous year-NIL) and Uday D. Desai Rs.2,000,000 (Previous year Rs. NIL)

n) Deposits repaid includes Mr. Veeral P. Desai Rs.1,000,000 (Previous Year Rs.NIL), Sujata V. Desai Rs.400,000 (Previous year Rs.NIL), Shital S. Kazi Rs.200,000 (Previous year Rs.NIL), Tejal V. Desai Rs.790,000 (Previous year Rs.NIL), Harshad .R. Gandhi Rs.900,000 (Previous year Rs.NIL) Kokila .H. Gandhi Rs.1,250,000 (Previous year Rs.NIL) Uday D. Desai Rs.2,000,000 (Previous Year Rs.NIL)

o) Loan & Advances in nature of expense reimbursement received during the year from Desai Agri Bio-Tech Pvt. Ltd. Rs.NIL (Previous Year Rs.3,400,000)

p) Loan & Advances in nature of expense reimbursement given during the year include Span Nihon-Kohden Pvt. Ltd. Rs. 167,287( Previous Year Rs. 120,447), Span Biotronics Pvt. Ltd. Rs.36,854( Previous Year Rs.930,204) Span Diagnostics SA Pty Rs.8481 (Previous year Rs.-NIL)

q) Loan received in the nature of fixed deposit from Dr.Pradeep K. Desai Rs.NIL ( Previous Year Rs.4,200,000), Shri Veeral P. Desai Rs.NIL( Previous Year Rs.500,000),Ms. Sujata V. Desai Rs.NIL( Previous Year Rs.300,000), Mrs. Tejal V. Desai Rs.NIL( Previous Year Rs.Nil), Dr. Harsad R. Gandhi Rs.NIL( Previous Year Rs.200,000), Mrs. Kokila H. Gandhi Rs.NIL( Previous Year Rs. 200,000)

r) Loans received included from Pradeep K. Desai Rs.702,000 (Previous Year Rs.-NIL) and Veeral P. Desai Rs.250,000(Previous year Rs.-NIL)

s) Loans and Advance repaid includes Pradeep K.Desai Rs.1,333,686 (Previous year Rs.NIL) and Veeral P. Desai Rs.250,000 (Previous Year Rs.NIL), Desai Agri Bio-tech Pvt. Ltd Rs.2,800,000 (Previous Year Rs.NIL)

t) Purchase of Technology include Span Biotronics Pvt Ltd Rs.12,866,001( Previous Year Rs.17,981,999), Span Diagnostics SARLRs. NIL (Previous Year Rs. .11,414,250)

u) Purchase of Investment includes Span SA(Pty,)Ltd.Rs.3172.18 (Previous year Rs.NIL)

v) Prepaid expense includes rent paid to Shri Veeral P. Desai Rs. 105,000 (Previous Year Rs.NIL), Sujata Desai Rs.105,000(Previous Year Rs.NIL)

9. The Company has given Rs. 2,520,000 as contribution to bonafide charitable institution. The Company has not obtained prior permission in the general meeting. The Company will obtain approval in the forth coming general meeting and will apply for the compounding of offence to appropriate authorities.

10. The figures for the previous year have been regrouped/recast wherever necessary in conformity with those of current year.

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Mar 31, 2014

1. Corporate Information

Span Diagnostics Limited is Public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The Company is engaged in the business of manufacturing, marketing and trading of diagnostics reagents, diagnostics instruments and allied products. The Company caters to both domestic and international markets. The Company also provides annual maintenance service for diagnostics instruments. It has various certifications like WHO-GMP, ISO 13485:2003 and ISO 9001:2000 and CE registration for almost 200 products thereby complying with globally accepted quality standards.

2. There was no increase in Capital during the current year. However, during the year 2010-11, 1,65,250 equity shares each of Rs. 10 were issued on a preferential basis by the company at a premium of Rs. 29.97 each aggregating to Rs. 66,05,042/-. Further 36,38,000 equity shares of Rs 10 each were issued in the year 2010-11 as bonus shares in ratio of 1:1 by capitalizing securities premium which in aggregate amounts to Rs. 3,63,80,000/-

3. Term Loan from banks other than Vehicle Loans are secured by hypothecation of plant and machineries, some of moveable properties of the company, equitable mortgage of some of the immovable properties of the company. Vehicle loans of Rs. 1,64,929 (Previous Year: Rs. 3,13,064) are secured by hypothecation of respective vehicles.

4. Term Loan from other parties and deferred payment liabilities are secured by hypothecation of moveable assets including Plant and Machinery and equipments which has been procured through utilization of earmarked funds and intangibles which will be generated from projects.

5. Secured Loans are guaranteed by some of the Directors of the company & Mrs. Lata P Desai.

6. Deposits includes deposits from Related Parties of Rs. 40,40,000 (Previous year Rs.89,53,000) (Refer Note 31) carrying rate of interest as per standard norms of deposits

7. Defined Benefit Plan

The Employee''s Group Gratuity Fund is the Company''s defined benefits plan for which the Company has taken Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up final obligation.

8. Investment Details :

The company has contracted with Life Insurance Corporation of India (LIC) to manage gratuity liability of the company.

The Company makes the required contribution to LIC based on computation of current service cost, expected earnings and actuarial assumption etc. The Company has not made any other investment for defined benefit plan.

9. CONTINGENT LIABILITIES AND COMMITMENTS

A. Contingent Liabilities

As at As at Particulars 31-3-2014 31-3-2013 Rs. Rs.

a) Taxes

(1) Sales tax

Demands under contest (Net of Tax) 5,66,001 4,06,103

C-Form Pending (Net of Tax) 20,88,125 14,38,922

(2) Income tax

Demands under dispute 2,16,07,889 2,16,07,889

b) Claims against the Company not acknowledged as Debts 25,42,704 39,27,954

c) On account of guarantees given by the bank on behalf of the company in favor of 5,38,78,577 4,81,60,197 customs and others.

d) The Company has imported material under the Advance Authorization Scheme of the 52 282 49 315 Government of India, at concessional rates of customs duty by undertaking obligations to export certain quantity of specified products, For the future outstanding export obligations quantity under the Scheme as at 31-03-2014, which if not fulfilled may result in custom duty liability of (Net of tax)

B. Capital Commitments

As at As at Particulars 31-3-2014 31-3-2013 Rs. Rs.

Estimated amount of contracts (Net of advances) remaining to be executed on 2,58,58,513 48,07,753 Capital Account and not provided for

10. SEGMENT REPORTING

The company operates in a single segment - Diagnostic Products.

DISCLOSURE IN RESPECT OF MATERIAL RELATED PARTY TRANSACTIONS DURING THE YEAR :

a) Sales of goods and materials includes sales to Span Biotronics Pvt. Ltd. Rs.3,44,400 (Previous Year Rs NIL).

b) Purchase/ materials consumed from Span Nihon Kohden Diagnostics Pvt. Ltd. Rs.52,362 (Previous Year Rs.NIL),Span Diagnostics SARL Rs.1,77,200( Previous Year Rs 1,77,250),Quest Biochemicals Pvt. Ltd. Rs.Nil (Previous Year Rs 17,328).

c) Payment to Key Management Personnel include to Dr. Pradip K. Desai Rs. 41,64,600 (Previous Year 87,76,000 ), Mr. Veeral P Desai Rs.42,78,800 (Previous Year Rs.44,03,800), Dr. Madhukanta T. Patel Rs.5,72,463 (Previous Year Rs.23,52,350), Ms. Sujata V. Desai Rs.32,33,600 (Precious Year Rs.35,18,524).

d) Interest on F.D./Loan includes Dr. M. T. Patel Rs. 1,17,165 (Previous Year Rs.3,85,975), Mr. Veeral P Desai Rs. 19,130 (Previous Year Rs. NIL), Dr. Pradip K. Desai Rs. 97,315 (Previous Year Rs. NIL), Ms.Sujata V. Desai Rs. 16,129 (Previous Year Rs.11,000), Ms. Shital S. Kazi Rs.23,000 (Previous Year Rs.23,000), Ms. Tejal V.Desai Rs.1,17,233 (Previous Year Rs.2,84,861), Dr. Harshad R.Gandhi Rs.1,03,024 (Previous Year Rs. 78,742), Ms. Kokila H. Gandhi Rs.1,43,202 (Previous Year Rs.1,18,921), Mr. Sunil T. Patel Rs. 8,617 (Previous Year Rs.32,942), Desai Agri Bio-Tech Pvt.Ltd. Rs.2,34,312 (Previous Year Rs.2,09,458).

e) Rent paid to Ms.Shital S.Kazi Rs. 48,000 (Previous Year Rs.NIL ), Ms. Bhanuben T. Patel Rs.24,000 (Previous Year Rs.87,000), Ms.Sudhaben I. Patel Rs. 33,000 (Previous Year Rs. 1,32,000).

f) Dividend Paid to Dr. Pradip K. Desai Rs. 6,53,440 (Previous Year Rs.NIL), Mr. Veeral P Desai Rs. 2,62,316 (Previous Year Rs.NIL), Dr. Madhuben T. Patel Rs.26,080 (Previous Year Rs.NIL), Ms. Sujata V. Desai Rs. 50,788 (Previous Year Rs.NIL), Ms. Lataben P Desai Rs. 3,58,530 (Previous Year Rs.NIL), Ms.Shital S. Kazi Rs.19,750 (Previous Year Rs.NIL), Ms.Tejal V. Desai Rs.5,000 (Previous Year Rs.NIL), Mr. Prakash K. Desai Rs.13,500 (Previous Year Rs.NIL), Mr. Sunil T. Patel Rs.5,000 (Previous Year Rs.NIL), Ms.Sudhaben I. Patel Rs.5,000 (Previous Year Rs.NIL).

g) Gardening Expense paid to Desai Agri Bio-Tech Pvt. Ltd. Rs. 7,20,000 (Previous Year Rs. 7,20,000).

h) Evaluation & Testing Charges paid to Quest Biochemicals Pvt. Ltd. Rs. 2,62,000 (Previous Year Rs NIL).

i) Sales and Distribution Expenses include amount Paid to Span Diagnostics SA. (Pty.) Ltd. Rs. 21,41,399 (Previous Year Rs.23,89,935).

j) Royalty paid to Span Diagnostics SARL Rs. 12,32,220 (Previous Year Rs. 13,22,096), Span Biotronics Pvt.Ltd Rs. 4,88,849 (Previous Year Rs. 44,370).

k) License Fees from Span Nihon-Kohden Pvt. Ltd. Rs.21,90,000 (Previous Year Rs. 21,90,000).

l) Other Income from Span Biotronics Pvt Ltd Rs. 10,34,793 (Previous Year Rs.11,53,566),Span Diagnostics SA. (Pty.) Ltd. Rs. 1,37,963 (Previous Year Rs.62,061), Dividend from Span Nihon Kohden Diagnostics Pvt. Ltd. Rs.36,00,000 (Previous Year Rs. 36,00,000), Dividend from Span Biotronics Pvt. Ltd. Rs.3,40,411 (Previous Year Nil).

m) Loan received in the nature of fixed deposit from Dr. Pradip K. Desai Rs.42,00,000 (Previous Year Rs.NIL), Mr. Veeral P Desai Rs.5,00,000 (Previous Year Rs.NIL), Dr. M.T.Patel Rs. Nil (Previous Year Rs. 8,00,000), Ms. Sujata V. Desai Rs.3,00,000 (Previous Year Rs.NIL), Ms. Tejal V. Desai Rs. Nil (Previous Year Rs.13,00,000), Dr. Harsad R. Gandhi Rs.2,00,000 (Previous Year Rs.NIL), Ms. Kokila H. Gandhi Rs. 2,00,000 (Previous Year Rs.NIL).

n) Loan & Advances in nature of expense reimbursement received during the year include Span Nihon-Kohden Pvt. Ltd. Rs.NIL (Previous Year Rs.1,53,441), loan received from Desai Agri Bio-Tech Pvt. Ltd. Rs.34,00,000 (Previous Year Rs.23,00,000).

o) Loan & Advances in nature of expense reimbursement given during the year include Span Nihon-Kohden Pvt. Ltd. Rs.1,20,447 (Previous Year Rs.1,25,639), Span Biotronics Pvt. Ltd. Rs. 9,30,204 (Previous Year Rs.41,50,567),Span Diagnostics SA. (Pty.) Ltd. Rs. Nil (Previous Year Rs.14,33,697),Quest Biochemicals Pvt. Ltd. Rs.Nil (Previous Year Rs 4,438).

p) Purchase of Technology include Span Biotronics Pvt Ltd Rs. 1,79,81,999 (Previous Year Rs.1,76,11,998), Span Diagnostics SARL Rs.1,14,14,250 (Previous Year Rs. 2,01,69,576).

q) Purchase of assets include Span Diagnostics SARL Rs.Nil (Previous Year Rs.7,76,719).

r) Preference Shares redeemed by Span Biotronics Pvt. Ltd. Rs. 5,00,000.

11. FINANCIAL AND DERIVATIVE INSTRUMENTS

Derivative contracts entered into by the Company and outstanding as on March 31,2014

(i) For hedging interest rate related risks derivative contract in nature of forward contract is entered into by the Company and outstanding of which as on March 31,2014 amount to Rs.Nil (Previous Year Rs. 1,09,84,334).

(ii) Foreign currency exposures on account of trade receivables/ trade payables not hedged by derivative instruments .

12. The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

13. NOTES ON DISCONTINUING OPERATION

During the year, the Company has entered into an agreement for transfer of business undertaking with the Arkray Healthcare Pvt Ltd (Purchaser) on January 24, 2014. The agreement was subject to shareholders'' approval along with compliance of certain conditions precedent prescribed in the agreement. One of the conditions was to obtain FIPB approval for the aforesaid transaction, which is critical event and non receipt of approval will make this agreement terminated. In light of the above information, management is of the view that although initial disclosure event in terms of Accounting Standard (AS) 24 - Discontinuing Operations has triggered, however bifurcation of assets and liabilities in to current and non current in the financial statements will be made considering its original realisation / settlement. As Mr. Veeral P. Desai, a promoter of the company will continue as Managing Director of the company and going forward, the company intends to utilize his expertise in carefully identified non-competing business areas, providing ample opportunities and handsome returns to share holder investments. In due course, the board shall also take up for consideration the potential use of the amount that would be received pursuant to the completion of the proposed transaction and finalisation of the consideration including the investment of such proceed in various new lines of business.

14. The figures for the previous year have been regrouped/recast wherever necessary in conformity with those of current year.

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Mar 31, 2013

1. Corporate Information :

Span Diagnostics Limited is Public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The Company is engaged in the business of manufacturing, marketing and trading of diagnostics reagents, diagnostics instruments and allied products. The Company caters to both domestic and international markets. The Company also provides annual maintenance service for diagnostics instruments. It has various certifications like WHO-GMP, ISO 13485:2003 and ISO 9001:2000 and CE registration for almost 200 products thereby complying with globally accepted quality standards.

2.1 There was no increase in Capital During the current year. However, during the year 2010-11, 165,250 equity shares each of Rs. 10 were issued on a preferential basis by the company at a premium of Rs. 29.97 each aggregating to Rs. 6,605,042/-. Further 3,638,000 equity shares of Rs. 10 each were issued in the year 2010-11 as bonus shares in ratio of 1:1 by capitalising securities premium which in aggregate amounts to Rs. 36,380,000/-

3.1 Term Loan from banks other than Vehicle Loans are secured by hypothecation of plant and machineries, some of moveable properties of the company, equitable mortgage of some of the immovable properties of the company. Vehicle loans of Rs. 313,064 (Previous Year: Rs. 682,589) are secured by hypothecation of respective vehicles.

3.2 Term Loan from other parties and deferred payment liabilities are secured by hypothecation of moveable assets including Plant and Machinery and equipments which has been procured though utilization of earmarked funds and intangibles which will be generated from projects.

3.3 Secured Loans are guaranteed by some of the Directors of the company.

3.4 Deposits includes deposits from Related Parties of Rs. 89,53,000 (Previous year Rs.71,90,000) (Refer Note 32) carrying rate of interest as per standard norms of deposits.

4.1 Working Capital Loan are secured by hypothecation of Current Assets and collaterally secured by the personal guarantees of promoter Directors, equitable mortgage of some of the immovable properties of the Company . The Interest rate in INR portion varies from 13.5% to 14.5%. Short Term Loan from Related Party is at 12%.

5 EXCEPTIONAL ITEMS

In current year there are no exceptional items. However in previous year,considering overall strategy of the Company and to focus on core diagnostic reagent manufacturing business of the Company and to obtain optimum price, the Company decided to hive off its Hematology business by way of business asset transfer including inventory, goodwill, etc. to M/s. Nihon Kohden India Private Limited, a subsidiary of Nihon Kohden Corporation, Japan subject to terms and condition mutually decided and as set out in the agreement. The Company has recorded Rs 29,072,127 in previous year on account of transfer of goodwill in light of this transactions.

6 SEGMENT REPORTING

The company operates in a single segment – Diagnostic Products.

7 RELATED PARTY DISCLOSURES

Related party Disclosures as required by AS-18 are given below.

A. Relationship.

(i) Related parties where control exists :

Span Biotherapeutics Pvt Ltd (Subsidiary)

Span Biotronics Pvt. Ltd. (Subsidiary)

Span Nihon Kohden Diagnostics Pvt. Ltd. (Joint Venture)

Span Diagnostics SA (Pty.) Ltd. - (Joint Venture)

(ii) Key Management Personnel :

Dr. Pradip K.Desai Mr. Veeral P. Desai Ms. Sujata V. Desai Dr. Madhukanta T. Patel

(iii) Relatives of key management personnel and their enterprise, where transactions have taken place :

Ms. Lata P. Desai

Ms. Tejal V. Desai

Ms. Shital S. Kazi

Mr. Prakash K. Desai

Shri. Pradip. K. Desai HUF

Dr. Harshad R. Gandhi

Ms. Kokila H. Gandhi

Mr. Sunil T. Patel

Ms. Bhanuben T. Patel

Ms. Sudhaben I. Patel

(iv) Enterprise over which persons described in (ii), (iii) above is able to exercise significant influence :

Span Diagnostics SARL Quest Biochemicals Pvt. Ltd Desai Agri Bio-tech Pvt. Ltd Note : Related party relationship on the basis of the requirements of Accounting Standard (AS) 18 as in 1 (i) to (iv) above is identified and certified by the Management and relied upon by the Auditors.

8 FINANCIAL AND DERIVATIVE INSTRUMENTS

Derivative contracts entered into by the Company and outstanding as on March 31, 2013 (i) For hedging interest rate related risks derivative contract in nature of forward contract is entered into by the Company and outstanding of which as on March 31, 2013 amount to Rs. 10,984,334 (Previous Year Rs. 110,180,885). (ii) Foreign currency exposures that are not hedged by derivative instruments as on March 31, 2013 amount to Rs 25,641,742 (net) (Previous Year Rs.22,589,704).

9 The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated February 8 2011 and February 21, 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

10 The figures for the previous year have been regrouped/recast wherever necessary in conformity with those of current year.

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Mar 31, 2011

A.Contingent Liabilities not provided 31-3-2011 31-3-2010 for in respect of Rs. Rs.

1.Sales tax: Demands under contest(Net of Tax) 401,459 396,815 C-Form Pending 1,144,652 544,000

2.Disputed Liquidated Damages with 1,232,982 422,813 respect to institutional customers (Net of Tax)

3.Excise Demand under dispute Nil 83,280

4.Claims against the Company not 6,196,668 6,205,418 acknowledged as Debts

5.On account of guarantees given 29,728,407 31,933,107 by the bank on behalf of the company in favor of customs and others.

6.The Company has imported capital 438,656 297,699 goods under the Export Promotion Capital Goods Scheme of the Government of India at concessional rates of customs duty by undertaking obligations to export, Future outstanding export obligations under the Scheme as on 31-03-2011 aggregating of US$ 91582 if not fulfilled may result in custom duty liability of (Net of tax)

7.The Company has imported material 919,218 11,656,611 under the Advance Authorization Scheme of the Government of India, at concessional rates of customs duty by undertaking obligations to export certain quantity of specified products, For the future outstanding export obligations quantity under the Scheme as at 31-03-2011, which if not fulfilled may result in custom duty liability of (Net of tax)

C. Employee Benefits

Disclosures pursuant to Accounting Standard - 15 (Revised)' Employee Benefits':

Defined Benefit Plan

The Employees' Group Gratuity Fund is the Company's defined benefits plan for which Company has taken Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method which recognizes 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.

v) Investment Details

The company has contracted with Life Insurance Corporation of India (LIC) to manage gratuity liability of the company. The Company makes the required contribution to LIC based on computation of current service cost, expected earnings and actuarial assumptions etc. The Company has not made any other investment for defined benefit plan.

F. Expenditure on Research and Development

Research and development expenditure of Rs. 19,230,425 is recognized as revenue expenses during the year.(Previous year Rs.20,236,200)

G. Increase in Equity Share Capital

During the year, 165,250 equity shares each of Rs. 10 were issued on a preferential basis by the company at a premium of Rs. 29.97 each aggregating to Rs. 6,605,042/-. Further 3,638,000 equity shares of Rs 10 were issued as bonus shares in ratio of 1:1 by capitalizing share premium which in aggregate amounts to Rs 36,380,000.

H. Lease

i) The Company does not have financial lease arrangement.

I. Segment reporting

The company operates in a single segment- Diagnostic Products.

J. Related party disclosures

Related party Disclosures as required by AS-18 are given below.

1 Relationship.

(i) Other Related parties where common control exists.

Span Biotherapeutics Pvt Ltd (Subsidiary) Span Biotronics Pvt. Ltd.(Subsidiary) Span Nihon Kohden Diagnostics Pvt. Ltd. (Joint Venture)

(ii) Key Management Personnel:

Dr. Pradip K.Desai Mr. VeeralP Desai Ms.SujataV. Desai Dr. Madhukanta T. Patel

(iii) Relatives of key management personnel and their enterprise, where transactions have taken place.

Ms. Lata P. Desai Ms. Tejal V. Desai Ms.Shital S.Kazi Mr. Prakash K. Desai Shri. Pradip. K. Desai HUF Dr.Harshad R. Gandhi Ms. Kokila H. Gandhi Mr. SunilT. Patel Ms. Bhanuben T. Patel Ms. Sudhaben I. Patel

(iv) Enterprise over which persons described in (ii). (iii) above is able to exercise significant influence.

Span Diagnostics SARL Quest Biochemicals Pvt. Ltd

Note: Related party relationship on the basis of the requirements of Accounting Standard (AS) 18 as in 1 (i) to (iv) above is identified and certified by the Management and relied upon by the Auditors.



Disclosure in Respect of Material Related Party Transactions during the year:

1. Sales of goods and material includes Span Diagnostic FZC Rs NIL (Previous Year Rs. 1,741,356), Span Nihon-Kohden Diagnostics Pvt. Ltd. Rs. NIL (Previous Year Rs. 403,419), Span Diagnostics SARLRs. 881,575 (Previous Year NIL).

2. Purchases/material consumed from Span Nihon-Kohden Diagnostics Pvt. Ltd. Rs. 59,475,754 (Previous Year Rs.44,555,825), Span Diagnostics SARL Rs. 189,745 (Previous Year NIL)

3. Payment to Key Management Personnel include to Dr. Pradip K. Desai Rs. 6,830,600 (Previous Year 7,220,600), Mr. Veeral P. Desai Rs. 4,403,800 (Previous Year Rs. 4,477,550 ), Dr. Madhukanta T. Patel Rs. 2,356,567 (Previous Year Rs.1,883,600), Ms. SujataV. Desai Rs. 2,319,950 (Precious Year Rs.1,971,888)

4. Interest on F.D./Loan includes Dr. Madhukanta T. Patel Rs. 228,048 (Previous Year Rs.92,064), Ms.Sujata V. Desai Rs. 6,419 (Previous Year Rs. 11,109), Dr. Pradip K. Desai Rs. NIL (Previous Year Rs.75,455), Mr. Veeral P. Desai Rs. NIL (Previous Year Rs.21,528), Ms. Lata P. Desai NIL (Previous Year Rs. 9,615), Ms. Shital S. Kazi Rs. NIL (Previous Year Rs.68,356), Ms. Tejal V. Desai Rs. 3,315 (Previous Year Rs. 205,745), Shri Pradip K. Desai (HUF) Rs. NIL (Previous Year Rs. 44,267), Dr. Harshad R. Gandhi Rs. 77,927 (Previous Year Rs. 75,214), Ms. Kokila H. Gnadhi Rs. 116,427 (Previous Year Rs. 112,794), Mr. SunilT. Patel Rs. 32,058 (Previous Year Rs. 31,902)

5. Rent paid to Mr. Veeral P. Desai Rs. 24,000 (Previous Year Rs. 22,000), Ms. Bhanuben T. Patel Rs. 60,000 (Previous Year Rs. 60,000), Ms.Sudhaben I. Patel Rs. 112,000 (Previous Year Rs. NIL)

6. Dividend Paid to Dr. Pradip K. Desai Rs. 651,975 (Previous Year Rs. NIL), Mr. Veeral P. Desai Rs. 655,790 (Previous Year Rs. NIL), Dr. Madhukanta T. Patel Rs. 69,950 (Previous Year Rs. NIL), Ms. Sujata V. Desai Rs. 126,970 (Previous Year Rs. NIL), Ms. Lata P. Desai Rs. 896,325 (Previous Year Rs. NIL), Ms. Shital S. Kazi Rs. 49375 (Previous Year Rs.NIL), Ms.Tejal V. Desai Rs.12,500 (Previous Year Rs. NIL), Mr. Prakash K. Desai Rs. 33,750 (Previous Year Rs. NIL), Shri Pradip K. Desai (HUF) Rs. 981,625 (Previous Year Rs. NIL), Mr. Sunil T. Patel Rs. 12,500 (Previous Year Rs. NIL), Ms. Sudhaben I. Patel Rs.12,500 (Previous Year Rs. NIL)

7. R&D Outsourcing Charges paid to Span Biotronics Pvt. Ltd. Rs. 9,140,000 (Previous Year Rs. 7,100,000)

8. Gardening Expense paid to Desai Agri Biotech Rs. 611,797 (Previous Year Rs. 611,362)

9. Sales and Distribution Expenses include to Span Diagnostics FZC Rs. NIL (Previous Year Rs. 1,007,203)

10. Royaltypaidto Span Diagnostics SARLRs. 1,154,651 (Previous Year Rs.NIL)

11. License Fees from Span Nihon-Kohden Pvt. Ltd. Rs.2,190,000 (Previous Year Rs.21,90,000)

12. Other Income from Span Diagnostics SARL Rs. NIL (Previous Year Rs.668,300), Span Diagnostics FZC Rs. NIL (Previous Year Rs.18,016)

13. Loan received in the nature of fixed deposit from Span Nihon-Kohden Pvt. Ltd. Rs. NIL (Previous Year Rs.3,000,000), Dr. Madhukanta T. Patel Rs. 800,000 (Previous Year Rs. NIL), Ms. Sujata V. Desai Rs. 100,000 (Previous Year Rs. NIL), Ms. Tejal V. Desai Rs. 250,000 (Previous Year Rs. NIL), Dr. Harshad R. Gnadhi Rs. NIL (Previous Year Rs.150,000), Ms. Kokila H. Gandhi Rs. NIL (Previous Year Rs. 200,000)

14. Loan & Advances in nature of expense reimbursement given during the year include Span Nihon-Kohden Pvt. Ltd. Rs.106,465 (Previous Year Rs.1,036,551), Span Biotherapeutics Pvt. Ltd. Rs. 6,038 (Previous Year Rs. NIL), Span Diagnostics SARL Rs. NIL (Previous Year Rs. 209,250), Span Biotronics Pvt. Ltd. Rs. 4,144 (Previous Rs. 100)

15. Purchase of Technology include Span Daignostics SARLRs. NIL(PreviousYearRs. 2,961,198)

16. Purchase of Fixed Assets include Span Daignostics SARL Rs. NIL (Previous Year Rs. 941,695)

17. Purchase of Investment include Span Biotherapeutics Pvt. Ltd. Rs. 99,900 (Previous Year Rs. NIL)

18. Loss on Sale of Investment Include Span Diagnostics FZC Rs. NIL (Previous Year Rs. 756,821)

K. Disclosure of Loans and Advances to Subsidiaries. Associates. Joint Ventures and Others (Pursuant to Clause 32 of the Listing Agreement):

During the year the Company has not entered into any transaction in nature of loans and advances which falls within the purview of clause 32 of the listing agreement

P. Exchange Rate Difference

The Exchange rate difference arising on foreign currency transactions has been credited to Profit and Loss account Rs. 787,520 (Profit) [Previous Year 6,151,205 (Profit)].

Q. Disclosure for Borrowing Cost Capitalized

In accordance with AS-16 related to Borrowing cost which amounts to Rs. 581,322 has been capitalized during the year (Previous Year Rs. 80,780)

S. Balances of sundry debtors are as per books of accounts. During the year Company has written off debtors to tune of Rs 10,45,012 (Previous Year 1,657,456) against provision made in earlier years as are considered non-recoverable.

T. The figures for the previous year have been regrouped/recast/reclassified wherever necessary in conformity with those of current year.

d) Derivative contracts entered into by the Company and outstanding as on 31st March, 2011

(i) For hedging interest rate related risks derivative contract in nature of forward contract is entered into by the Company and outstanding of which as on 31st March,2011amounttoRs 109,995,200 (ii) Foreign currency exposures that are not hedged by derivative instruments as on 31st March,2011 amount to Rs.18,550,313(net)

h) Quantitative Details (Manufacturing)

NOTES : 1. Licenced Capacity : As per Industrial Enterpreneur Memorandum filed with Government of India. In respect of the products presently manufactured by the company.

2. Sales are shown after discount and sales return. 3. Materials produced for captive use excluded from sales. 4. Previous year figures are shown in brackets. 5. Annual Installed capacity being a techincal matter, it is as certified by the production manager and accepted by the auditors.

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Mar 31, 2010

A. Contingent Liabilities not provided for in respect of

31-3-2010 31-3-2009 Rs. Rs.

1 Sales tax:

Demands under contest (Net of Tax) 396,815 1,820,040 C-Form Pending (Net of Tax) 544,000 167,000

2 Disputed Liquidated Damages with respect to institutional customers (Net of Tax) 422,813 Nil

3 Excise Demand under dispute (Net of Tax) 83,280 83,280

4 Claims against the Company not acknowledged as Debts 6,205,418 6,335,500

5 On account of guarantees given by the bank on behalf of the company in favour 31,933,107 22,344,425 of customs and others.

6 The Company has imported capital goods under the Export Promotion Capital 297,699 428,741 Goods Scheme of the Government of India at concessional rates of customs duty by undertaking obligations to export. Future outstanding export obligations under the Scheme as on 31-03-2010 aggregating of USD 76,944.10 if not fulfilled may result in custom duty liability of (Net of tax)

7 The Company has imported material under the Advance Authorization Scheme of the Government of India, at concessional rates of customs duty by 11,656,611 Nil undertaking obligations to export certain quantity of specified products. Future outstanding export obligations quantity under the Scheme as at 31-03-2010, which if not fulfilled may result in custom duty liability of (Net of tax)

C. Employee Benefits

Disclosures pursuant to Accounting Standard -15 (Revised) Employee Benefits:

Defined Benefit Plan

The Employees Group Gratuity Fund is the Companys defined benefits plan for which Company has taken Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method which recognizes 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.

v) Investment Details

The company has contracted with Life Insurance Corporation of India (LIC) to manage gratuity liability of the company. The Company makes the required contribution to LIC based on computation of current service cost, expected earnings and actuarial assumptions etc. The Company has not made any other investment for defined benefit plan.

F. Expenditure on Research and Development

Research and development expenditure of Rs. 205.16 Lacs is recognised as revenue expenses during the year.(PreviousyearRs.81.92Lacs.)

G. Increase in Equity Share Capital

During the year, 165,250 preferenceequity shares each of Rs. 10 were issued on a preferential basis by the company at a the premium of Rs. 29.97 each aggregating to Rs. 6,605,042/-. The same was utilized for funding the capital expenditure / strategic investment.

H. Impairment Loss

There was no impairment loss on Fixed Assets on the basis of review carried out by the Management in accordance with Accounting Standard 28 Impairment of Asset.

I. Segment reporting

The company operates in a single segment- Diagnostic Products.

K. Related party disclosures

Related party Disclosures as required by AS-18 are given below.

1 Relationship.

(i) Other Related parties where common control exists. Span Finstock Pvt.Ltd.

Quest Biochemicals Pvt. Ltd.

Span Diagnostics SARL

Span Diagnostics FZC

Span Biotronics Private Limited

Span Nihon Kohden

Diagnostics Pvt. Ltd.

(ii) Key Management Personnel:

Dr. Pradip. K.Desai

Mr. Veeral. P. Desai

Mrs.Sujata V.Desai

Miss Madhukanta T. Patel

(iii) Relatives of key management personnel and their enterprise, where transactions have taken place.

Mrs. Lata P. Desai

Mrs. Tejal V. Desai

Mrs. Shital S. Kazi

Shri. Pradip. K. Desai HUF

Dr. Harshad R. Gandhi

Mrs. Kokila H. Gandhi

Mr. SunilT. Patel

Smt. Bhanuben T. Patel

(iv) Enterprise over which persons described in (ii) above is able to exercise significant influence. Desai Metropolis Health Services Pvt. Ltd. Span Educational & Research Foundation

Note: Related party relationship on the basis of the requirements of Accounting Standard (AS) 18 as in 1 (i) to (iv) above is identified and certified by the Management and relied upon by the Auditors.

J. Exchange Rate Difference

The Exchange rate difference arising on foreign currency transactions has been credited to Profit and Loss account Rs. 61.51 Lacs (Profit) [Previous Year 106.78 Lacs (loss)].

K. Disclosure for Borrowing Costs capitalized

In accordance with AS-16 related to Borrowing costs which amounts to Rs.0.81 lacs has been capitalized during the year (Previous year Rs. 14.74 Lacs ).