Accounting Policies of Venmax Drugs & Pharmaceuticals Ltd. Company

Mar 31, 2024

3.3 Significant Accounting Policies

(a) Revenue Recognition

i. Revenue is recognized when the significant risks and rewards of ownership have been
transferred to the customers. Revenue is measured net of returns, trade discounts and
volume rebates. The timing of the transfer of risks and rewards varies depending on the
individual terms of the sales agreement.

ii. Revenues from contracts priced on a time and material basis are recognized when services
are rendered and related costs are incurred.

iii. Revenues from turnkey contracts, which are generally time bound fixed price contracts, are

recognised over the life of the contract using the proportionate completion method, with
contract costs determining the degree of completion. Foreseeable losses on such contracts
are recognised when probable.

iv. Revenues from maintenance contracts are recognised pro-rata over the period of the
contract.

v. Revenue from sale of goods will be recognized when the delivery of goods has happened, and
ownership is transferred to buyer.

vi. Interest income is recognized on the accrual basis using transactional interest rates.

(b) Property, Plant and Equipment (PPE)

i. All fixed assets are stated at cost of acquisition or construction less accumulated depreciation.

ii. Recognition and measurement: Normally Property, plant and equipment are measured at
cost less accumulated depreciation and impairment losses, if any. Cost includes expenditures
directly attributable to the acquisition of the asset. The Company has elected to apply the
optional exemption to use this previous GAAP value as deemed cost on 1 April 2017, the date
of transition.

iii. Depreciation has been provided on straight line method based on life assigned to each asset
in accordance with Schedule II of the Companies Act 2013.

iv. Depreciation on additions to fixed assets has been calculated on pro-rata basis from the date
of addition.

v. No depreciation has been provided on the fully depreciated assets.

(c) Borrowing cost

Borrowing costs attributable to the acquisition/construction of qualifying assets are capitalized
and form part of the cost of the qualifying assets. A qualifying asset is an asset that necessarily
takes a substantial period of time to get ready for its intended use. All other borrowing costs are
charged to revenue as an expense.

(d) Income Tax

Current Tax is determined as the amount of tax payable in respect of taxable income for the
period. Deferred Tax is recognized, on timing differences, being the difference between taxable
Income and accounting Income that originates in one period and are capable of reversal in one
or more subsequent periods. Deferred Tax assets are recognized subject to the consideration
of prudence. The tax rates and laws that have been enacted or substantively enacted as of the
balance sheet date are applied.

(e) Inventories

Inventories are measured at lower of cost and net realizable value after providing for obsolescence,
if any. Cost of inventories comprises of cost of purchase, cost of conversion and other cost
including manufacturing overheads incurred in bringing them to their respective present location
and condition. Cost of raw materials, work-in- progress, packing materials, trading and other
products are determined on first-in-first-out basis.

(f) Deferred Revenue Expenditure

Expenditure incurred on advertisement and other expenses for promotion of new products and
recruitment of key personnel is amortized over a period of five years, having due regard to the
nature of expenses and the benefit that may be derived there from. Expenditure on routine
product advertisement and personnel recruitment is expensed off to profit & loss account in the
year in which it is incurred.

(g) Cash and cash equivalents

Cash and cash equivalents for the purposes of cash flow statement comprise cash at bank and in
hand and short-term deposits with banks with an original maturity of three months or less.

(h) Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit before tax is adjusted for the
effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating
cash receipts or payments and item of income or expenses associated with investing or financing
cash flows. The cash flows from operating, investing and financing activities of the Company are
segregated.

(i) Loans and borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured
at amortised cost. Gains and losses are recognised in profit and loss when the liabilities are
derecognized. This category generally applies to interest-bearing loans and borrowings.

(j) Foreign currency transactions

Transactions arising in foreign currency during the year are recorded at average rates closely
approximating those ruling at the transaction dates. Current Assets and Current Liabilities,
denominated in foreign currency, are translated at the exchange rate prevalent at the date of
the Balance Sheet. Exchange differences arising on foreign currency transactions/translations
are recognized as income or expense in the Profit & Loss Account, except those relating to the
acquisition of fixed assets, which are adjusted against the cost of the assets.

(k) 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) Employee benefits

All Employee Benefits payable for rendering the service such as Salaries, Wages etc. and the
expected cost of ex-gratia are recognised in the period in which the employee renders the related
service. A Liability is recognised for the amount expected to be paid when there is a present legal
or constructive obligation to pay this amount as a result of past service provided by the employee
and the obligation can be estimated reliably.

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Mar 31, 2014

1. ACCOUNTNG ASSUMPTIONS :

The accounts have been prepared under the historic cost convention on the basis of a going concern concept, with revenues recognized and expenses accounted for on their accrual with due provisions/adjustments for obligations that have been crystallized but not yet incurred.

2. SALES :

Sales include VAT.

3. BASIS OF PRESENTAION :

The structure of the accounts has been drawn in accordance with the Revised Schedule VI of the Companies Act, 1956.

4. FIXED ASSETS:

Fixed Assets are stated at cost less depreciation. Cost includes freight, installation Charges, duties, taxes, and other incidental charges thereon.

5. DEPRECIATION:

Depreciation is charged on straight line method as per Schedule XIV of the Companies Act, 1956. Depreciation on assets acquired during the year is calculated on pro-rata basis with reference to the date of acquisition.

6. TAXATION:

Deferred Tax is recognized, subject to the consideration of prudence, on timing difference being the differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

7. INVENTORIES:

Inventories are valued as under.

a) Raw materials are valued at cost less VAT.

b) Finished goods are valued at cost price excluding Central Excise on them.

c) Excise duty is accounted for as and when the same is paid on the dispatch of the goods from the factory.

8. RETIREMENT BENEFITS

The company has a policy of paying retirement benefits to its employees as and when due.

9. INVESTMENTS:

Investments stated at cost.

10. MISCELLANEOUS EXPENDITURE:

All expenditure, the benefit of which is spread over a number of years grouped under Miscellaneous Expenditure to be amortized in five instalments from the year in which the benefit of such expenditure accrues.

Notes forming part of the Balance Sheet as at 31st March, 2014 and Profit and Loss statement for the period ended on that date.

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Mar 31, 2013

1. ACCOUNTNG ASSUMPTIONS:

The accounts have been prepared under the historic cost convention on the basis of a going concern concept, with revenues recognized and expenses accounted for on their accrual with due provisions/adjustments for obligations that have been crystallized but not yet incurred.

2. SALES:

Sales exclude excise duty and VAT.

3. BASIS OF PRESENTAION:

The structure of the accounts has been drawn in accordance with the Revised Schedule VI of the Companies Act, 1956.

4. FIXED ASSETS:

Fixed Assets are stated at cost less depreciation. Cost includes freight, installation Charges, duties, taxes, and other incidental charges thereon. The plant and

Machinery acquired during the year is capitalized net of CENVAT and VAT Credit available on such purchase.

5. DEPRECIATION:

Depreciation is charged on straight line method as per Schedule XIV of the Companies Act, 1956. Depreciation on assets acquired during the year is calculated on pro-rata basis with reference to the date of acquisition.

6. TAXATION:

Deferred Tax is recognized, subject to the consideration of prudence, on timing difference being the differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

7. INVENTORIES:

Inventories are valued as under.

a) Raw materials are valued at cost less CENVAT & VAT.

b) Finished goods are valued at cost price excluding Central Excise on them.

c) Excise duty is accounted for as and when the same is paid on the dispatch of the goods from the factory.

8. RETIREMENT BENEFITS

The company has a policy of paying retirement benefits to its employees as and when due.

9. INVESTMENTS:

Investments stated at cost.

10. MISCELLANEOUS EXPENDITURE:

All expenditure, the benefit of which is spread over a number of years grouped under Miscellaneous Expenditure to be amortized in five installments from the year in which the benefit of such expenditure accrues.

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Mar 31, 2012

1. ACCOUNTNG ASSUMPTIONS :

The accounts have been prepared under the historic cost convention on the basis of a going concern concept' with revenues recognized and expenses accounted for on their accrual with due provisions/adjustments for obligations that have been crystallized but not yet incurred.

2. SALES:

Sales exclude excise duty and VAT.

3. BASIS OF PRESENTAION :

The structure of the accounts has been drawn in accordance with the Revised Schedule VI of the Companies Act' 1956.

4. FIXED ASSETS:

Fixed Assets are stated at cost less depreciation. Cost includes freight' installation Charges' duties' taxes' and other incidental charges thereon. The plant and Machinery acquired during the year is capitalized net of CENVAT and VAT Credit available on such purchase.

5. DEPRECIATION:

Depreciation is charged on straight line method as per Schedule XIV of the Companies Act' 1956 Depreciation on assets acquired during the year is calculated on pro-rata basis with reference to the date of acquisition.

6. TAXATION:

Deferred Tax is recognized' subject to the consideration of prudence' on timing difference being the differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

7. INVENTORIES: Inventories are valued as u ider.

a) Raw materials are valued at cost less CENVAT & VAT.

b) Finished goods are valued at cost price excluding Central Excise on them.

c) Excise duty is accounted for as and when the same is paid on the dispatch of the goods from the factory.

8. RETIREMENT BENEFITS

The company has a policy of paying retirement benefits to its employees as and when due.

9. INVESTMENTS: Investments stated at cost.

10. MISCELLANEOUS EXPENDITURE:

All expenditure' the benefit of which is spread over a number of years grouped under Miscellaneous Expenditure to be amortized in five installments from the year in which the benefit of such expenditure accrues.

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Mar 31, 2011

1.ACCOUNTNG ASSUMPTIONS:

The accounts have been prepared under the historic cost convention on the basis of a going concern concept, with revenues recognized and expenses accounted for on their accrual with due provisions/adjustments for obligations that have been crystallized but not yet incurred.

2. SALES:

Sales exclude excise duty and VAT.

3. BASIS OF PRESENTAION :

The structure of the accounts has been drawn in accordance with the Schedule VI of the Companies Act, 1956.

4. FIXED ASSETS:

Fixed Assets are stated at cost less depreciation. Cost includes freight, installation Charges, duties, taxes, and other incidental charges thereon. The plant and Machinery acquired during the year is capitalized net of CENVAT and VAT Credit available on such purchase.

5. DEPRECIATION:

Depreciation is charged on straight line method as per Schedule XIV of the Companies Act, 1956. Depreciation on assets acquired during the year is calculated on pro-rata basis with reference to the date of acquisition.

6. TAXATION:

Deferred Tax is recognized, subject to the consideration of prudence, on timing difference being the differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

7. INVENTORIES:

Inventories are valued as under.

a) Raw materials are valued at cost less CENVAT & VAT.

b) Finished goods are valued at cost price excluding Central Excise on them.

c) Excise duty is accounted for as and when the same is paid on the dispatch of the goods from the factory.

8. RETIREMENT BENEFITS

The company has a policy of paying retirement benefits to its employees as and when due.

9. INVESTMENTS: Investments stated at cost.

10. MISCELLANEOUS EXPENDITURE:

All expenditure, the benefit of which is spread over a number of years grouped under Miscellaneous Expenditure to be amortized in five installments from the year in which the benefit of such expenditure accrues.1.ACCOUNTNG ASSUMPTIONS:

The accounts have been prepared under the historic cost convention on the basis of a going concern concept, with revenues recognized and expenses accounted for on their accrual with due provisions/adjustments for obligations that have been crystallized but not yet incurred.

2. SALES:

Sales exclude excise duty and VAT.

3. BASIS OF PRESENTAION :

The structure of the accounts has been drawn in accordance with the Schedule VI of the Companies Act, 1956.

4. FIXED ASSETS:

Fixed Assets are stated at cost less depreciation. Cost includes freight, installation Charges, duties, taxes, and other incidental charges thereon. The plant and Machinery acquired during the year is capitalized net of CENVAT and VAT Credit available on such purchase.

5. DEPRECIATION:

Depreciation is charged on straight line method as per Schedule XIV of the Companies Act, 1956. Depreciation on assets acquired during the year is calculated on pro-rata basis with reference to the date of acquisition.

6. TAXATION:

Deferred Tax is recognized, subject to the consideration of prudence, on timing difference being the differences between taxable incomes and accounting income that originate in one period and are capable of reversal in one or more subsequent periods.

7. INVENTORIES:

Inventories are valued as under.

a) Raw materials are valued at cost less CENVAT & VAT.

b) Finished goods are valued at cost price excluding Central Excise on them.

c) Excise duty is accounted for as and when the same is paid on the dispatch of the goods from the factory.

8. RETIREMENT BENEFITS

The company has a policy of paying retirement benefits to its employees as and when due.

9. INVESTMENTS: Investments stated at cost.

10. MISCELLANEOUS EXPENDITURE:

All expenditure, the benefit of which is spread over a number of years grouped under Miscellaneous Expenditure to be amortized in five installments from the year in which the benefit of such expenditure accrues.

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Mar 31, 2009

1.SECURED LOANS :

Working Capital from Union Bank of India is secured by hypothecation of the stocks of raw materials, packing materials, work-in-process and finished goods and also consumables stores and lien on all receivables and personal guarantee of Promoter Directors and second charges of fixed assets.

2.DEPRECIATION

Depreciation on fixed assets provided as per the rate prescribed in Schedule XIV of the Companies Act, 1956 on straight lone method. The depreciation in the current year taken on Plant and Machinery on single shift basis, because the Company operated for one shift only. The depreciation on vehicle has not been provided because it has not been transferred in the name of Company.

3. No bonus has been paid or provided during the period in the accounts of the Company.

4. INVENTORIES:

Excise duty has not been provided on finished goods not Cleared from the factory. However, this has no bearing on the profit/loss for the Current year.

5.INCOME TAX:

Since the Company has carried forward loses and it is is sick unit under rehabilitation no provision is made for Income Tax or MAT.