1. SIGNIFICANT ACCOUNTING POLICIES A. Basis of brparation of financial statements : The accompanying financial statements are brpared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on the accruals basis. GAAP comprises mandatory accounting standards issued by the Institute of Chartered Accountants of India (ICAI), the provisions of the Companies Act, 2013 and guidelines issued by the Securities and Exchange Board of India. Accounting policies have been consistently applied and management evaluates all recently issued or revised accounting standards on an ongoing basis. 1. Fixed Assets and Debrciation : Fixed Assets are stated at cost less accumulated debrciation. Cost includes all expenses related to acquisition and installation of the concerned assets and, any attributable cost of bringing the asset to the condition of its intended use. Debrciation is provided under the straight-line method based on useful life of assets as estimated by the Management. Debrciation is charged on a monthly pro-rata basis for assets purchased / sold during the year. Individual assets acquired for less than Rs. 5,000 are entirely debrciated in the year of acquisition. The Management's estimate of useful life for various fixed assets is as under : 2. REVENUE RECOGNITION Revenue for the company is from medical diagnostic services. Revenue from sales and services are recognized on formal acceptance by the customer/patient. 3. INVENTORIES Raw Materials/Inventory - At Cost or the net realizable value whichever is less. Cost is determined on a First in First out basis. Finished Goods - At cost or net realizable value whichever is less. 4. Expenditure on the ongoing product development for "Meningitis Vaccine, Erythropoietin, Tacrolimus, Statins ( Orlistat, Lovastatin Pravastatin ), Cancer products and Oral Insulin will be capitalized and written off over a period of the expected useful life of the respective products after obtaining commercial license/commencement of commercial production of the same. The management is of the opinion that the product development expenditure incurred on the products is technically feasible to generate future economic benefits and the company has sufficient technical resources to complete it. 5. RETIREMENT BENEFITS A) The Company is contributing to the Employees Provident fund maintained under the Employees Provident Fund Scheme by the Central Government. B) Leave encashment is not provided during the year. C) No provision is made towards the gratuity of employees. 6. INTERNALLY GENERATED INTANGIBLE ASSETS Direct and indirect costs incurred during planning stage, and on operational activities charged to revenue in the year in which it has incurred. Direct cost incurred on application & infrastructure development, design and content development stages are capitalized if and only if (i) it is probable that the future economic benefits that are attributable to the asset will flow to the enterprise and (ii) the cost of the asset can be measured reliably. Indirect cost incurred during application, infrastructure, development stage are charged to revenue. 7. EARNINGS PER SHARE In determining earnings per share, the company considers the net profit after tax. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding at the during the year. The number of shares used in computing diluted earnings per share comprises the weighted average shares outstanding during the year. 8. CASH FLOW STATEMENT Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for the effects of transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the company are segregated. Cash flows in foreign currencies are accounted at average monthly exchange rates that approximate the actual rates exchange brvailing at the dates of the transactions. 9. INCOME-TAX Current tax is determined as the amount of tax payable in respect of taxable income for the year. As there is no virtual certainty in utilizing the deferred tax asset, hence, the deferred tax asset has not been recognized in the books of accounts. B. NOTES FORMING PART OF THE ACCOUNTS 1. Previous year figures have been regrouped and reclassified, wherever necessary according to the groupings and classifications are made for the current financial year. 2. The Department of Biotechnology has sanctioned a loan amount of Rs.4.09 crores under Small Business Innovative Research Initiative (SBIRI) scheme for the novel technology upgradation of oralstat research, for which a charge against movable and Immovable assets acquired from utilization of the said loan amount has been created. SBIRI has demanded an interest of Rs 35,47,901/- for which a provision has been made though the management is yet to ascertain the actual liability of the company in this regard . 3. The company has made 100% provision for the investment made in the Transgene Biotek HK Limited (Subsidiary) for Rs. 92,20,09,728/-in the wake of the Auditors report of the Wholly Owned Subsidiary. Further, 100% provision is made against payment made to M/s. Symetric Sciences Inc utilized out of GDR proceeds. This is without brjudice to the company's claim in this regard. 4. The following are the Related Party Disclosures as per the AS-18 as notified under the Companies Act 2013. 5. In the opinion of the Board, current assets, loans and advances are realizable at a value, which is at least equal to the amount, at which these are stated, in the ordinary course of business. Balances of sundry debtors, sundry creditors, loans and advances, and other parties are subject to independent confirmation from the respective parties. 6. Periodically the Company evaluates all customers due to the company for collectables. The need for provisions is assessed based on the various factors including collectables of specific dues, risk perceptions of the industry in which the customers operate, and general economic factors, which could affect the customer's ability to settle. 7. Notes forming integral part of the Balance Sheet and Profit & Loss Account and have been duly authenticated. For Gopal & Rajan For and on behalf of the board of Directors Firm Registration No.000953S Transgene Biotek limited Chartered Accountants Sd/- K. Goutham Subaiah Partner Membership No. 203237 Sd/- Dr. K. Koteswara Managing Director Sd/- Rao S.S. Das Director Place : Hyderabad Date : 06.09.2015 |