annexed to and forming part of the consolidated accounts (Rs. in lacs) As at 31st March As at 31st March

Transcription

1 SCHEDULES annexed to and forming part of the consolidated accounts SCHEDULE - 1 : SHARE CAPITAL Authorised 750,00,000 Equity Shares of Rs.10 each ,00,000 Preference Shares of Rs.100 each Issued & Subscribed 211,59,840 Equity Shares of Rs.10 each Paid-up 211,52,840 (previous year 211,59,840) Equity Shares of Rs.10 each Less : Allotment Money in arrears Add : Shares Forfeited Notes : (a) 143,37,456 Equity Shares of Rs.10 each were allotted as fully paid up Bonus Shares by way of capitalization of General Reserve. (b) 6,22,384 Equity Shares of Rs.10 each were allotted without payment being received in cash pursuant to the schemes of amalgamation. SCHEDULE - 2 : RESERVES AND SURPLUS Capital Reserve Balance as per last Balance Sheet Capital Redemption Reserve Balance as per last Balance Sheet Share Premium Account Balance as per last Balance Sheet Less: Amount in arrears on account of forfeiture of shares Debenture Redemption Reserve Balance as per last Balance Sheet Less: Transfer to General Reserve General Reserve Balance as per last Balance Sheet Add : Transfers from : Debenture Redemption Reserve Profit and Loss Account Surplus balance in Profit & Loss Account

2 Torrent Pharmaceuticals Limited SCHEDULE - 3 : SECURED LOANS Debentures 12,00, % Secured Redeemable Non- Convertible Debentures of Rs.100 each (Current year Rs. Nil, Previous year Rs each) SCHEDULE - 4 : UNSECURED LOANS Sales Tax Deferment SCHEDULE - 5 : FIXED ASSETS PARTICULARS GROSS BLOCK (AT COST) DEPRECIATION & AMORTISATION NET BLOCK As on Addition Deductions As on Up to For the on Up to As at As at Up to Up to Period Deductions/ 01/04/03 31/03/04 31/03/04 31/03/04 01/04/03 Adjustments 31/03/04 31/03/04 31/03/03 Goodwill Freehold Land Leasehold land Buildings Plant & Machineries Electrical Installations Fur.& Fixture, Office & Factory Appliances Vehicles Intangible Assets - Software TOTAL Previous Year st annual report 67

3 SCHEDULE - 6 : INVESTMENTS (Unquoted unless otherwise stated) LONG TERM INVESTMENTS : No. of Shares Trade Charterhouse Therapeutics Ltd.- Fully paid up Equity Shares of GBP 0.01 each Less: Provision for diminution [see note 7] JSC Pharmimex-Russia - Fully paid up Equity Shares of Roubles 10 each (42900) Less: Provision for diminution Non - Trade National Savings Certificates (Lodged with Excise and Sales Tax authorities) Contribution to Gujarat Venture Capital Fund 1990 & CURRENT INVESTMENTS : Non - Trade Fully paid up Equity Shares of Rs.10 each (Quoted) Datar Switchgear Ltd Punjab Woolcombers Ltd Unified Agro Industries (I) Ltd Rajinder Pipes Ltd W.S. Telesystems Ltd Less: Provision for diminution in value Aggregate market value of quoted Investments in Equity Shares Rs.Nil (Previous Year Rs.Nil) Mutual Fund units : No of Units GCFG Grindlays Cash Fund - Growth Option ( ) ( units sold during the year) Templeton India Liquid Fund - Growth Plan ( ) ( units sold during the year) HDFC Liquid Fund - Growth ( ) ( units sold during the year) Prudential ICICI Liquid Plan Monthly Dividend Option (844959) (8801 units purchased & units sold during the year) Prudential ICICI Liquid Plan Institutional ( units purchased and units sold during the year) 68

4 Torrent Pharmaceuticals Limited GCDB Grindlays CF Pl.B (Institutional) Daily Dividend ( units purchased and units sold during the year) Templeton India Treasury Management - - ( units purchased & sold during the year) HDFC Liquid Fund Premium Plan Weekly Dividend - - ( units purchased & sold during the year) GCFD Daily Dividendd Option (Reinvestment) - - ( units purchased & sold during the year) Prudential ICICI Income Plan Qtly.Div. Option Reinv. - - ( units purchased & sold during the year) Templeton India Income Builder Quarterly Dividend - - ( units purchased & sold during the year) Grindlays Super Saver Income Fund Qtly.Div.Option - - ( units purchased & sold during the year) Tata Income Fund ( units purchased and units sold during the year) DSP ML Liquid Fund-Daily Dividend Reinvestment - - ( units purchased & sold during the year) JM High Liquidity Daily Dividend Reinvestment ( units purchased and units sold during the year) KM K Liquid Daily Dividend Reinvestment Instit.Plan ( units purchased and units sold during the year) KM K Liquid Weekly Dividend IP - - ( units purchased & sold during the year) Templeton India IB-Monthly Dividend - - ( units purchased & sold during the year) Prudential ICICI Flexible Income Plan Growth - - ( units purchased & sold during the year) JM Income Fund-Institutional Plan-Monthly Dividend - - ( units purchased & sold during the year) Kotak Bond Unit Scheme 99 Inst.Plan - Growth - - ( units purchased & sold during the year) Grindlays Dynamic Bond Fund - Plan B - Growth - - ( units purchased & sold during the year) JM High Liquidity Fund - IP - Growth - - ( units purchased & sold during the year) Kotak Liquid Instituitional Plan - Growth - - ( units purchased & sold during the year) Grindlays Cash Fund - IP - Growth - - ( units purchased & sold during the year) st annual report 69

5 Templeton India TMA - Growth - - (35483 units purchased & sold during the year) - - Prudential ICICI Liquid Plan - Growth - - ( units purchased & sold during the year) Templeton India Income Builder - IP Growth ( units purchased during the year) Grindlays Dynamic Bond Fund - IP Qtr. Dividend ( units purchased during the year) Franklin Templeton Fund - Growth Option Franklin Templeton Floating Rate Income Fund - Dividend Reinvestment Option (15482 units purchased during the year) Aggregate NAV of Investments in Mutual Funds Rs lacs (Previous Year Rs lacs) Aggregate amount of Unquoted Investments SCHEDULE - 7 : INVENTORIES Packing Materials Stock-in-Trade: Raw Materials Finished Goods Traded Goods Goods in Process SCHEDULE - 8 : SUNDRY DEBTORS (Unsecured) Debts over six months Considered Good Doubtful Less : Provision Other Debts - Considered Good

6 Torrent Pharmaceuticals Limited SCHEDULE - 9 : CASH AND BANK BALANCES Cash on hand A. With Scheduled Banks in : a) current accounts b) term deposit accounts : [Rs lacs lodged with Banks as securities for L/C and other facilities (Previous Year Rs lacs) and Rs. Nil in Escrow Account (Previous Year Rs lacs) B. With Non-Scheduled Bank in a) in current accounts b) In Fixed Deposit accounts SCHEDULE - 10 : OTHER CURRENT ASSETS Export benefits receivable Customs, Excise & Insurance Claims receivable Considered Good Doubtful Less : Provision Receivable on account of penalty Interest accrued Others SCHEDULE - 11 : LOANS AND ADVANCES (Unsecured and considered good) Advances recoverable in cash or in kind or for value to be received Balance with the Excise Department / ICMS Advance Tax Paid net of Provisions st annual report 71

7 SCHEDULE - 12 : CURRENT LIABILITIES Sundry Creditors Book Overdraft Investor Education and Protection Fund: Unclaimed Dividend Unclaimed Share Application Money Unclaimed Matured Fixed Deposits Unclaimed Matured Debentures Interest accrued on above Taxes / VAT Payable Advances from Customers SCHEDULE - 13 : PROVISIONS Proposed Dividend Tax on Distributed Profits Accrued leave SCHEDULE - 14 : MISCELLANEOUS EXPENDITURE (To the extent not written off) Miscellaneous Expenditure Year ended Year ended SCHEDULE - 15 : SALES & OPERATING INCOME Sales [see note 5(a) & 10(a)] Domestic (net of Sales Tax & VAT) Exports Total Less: Excise Duty/ICMS collected Operating Income Export Benefits Processing Charges (Tax Deducted at Source Rs.2.60 lacs, Previous Year Rs lacs) Option Fee Income Income from Contract Research Income from Product Registration Dossiers Excess provision of earlier years written back Other Operating Income [see note 10(b)]

8 Torrent Pharmaceuticals Limited Year ended Year ended SCHEDULE - 16 : OTHER INCOME Dividend Lease Rent Profit on Sale of Investments (net) Miscellaneous Income SCHEDULE - 17 : MATERIALS CONSUMED & PURCHASE OF TRADED GOODS Raw Materials Packing Materials Purchase of Traded Goods SCHEDULE - 18 : (INCREASE)/DECREASE IN STOCK Opening Stocks Finished Goods Traded Goods (current period excludes Rs lacs transfer to Raw Materials consumption) Work in Process Less : Closing Stocks Finished Goods Traded Goods Work in Process ( ) (479.00) SCHEDULE - 19 : PERSONNEL COSTS Salaries, Wages and Bonus Contribution to Provident, Gratuity and other Social Security Funds Welfare Expenses Commission to managerial personnel st annual report 73

9 Year ended Year ended SCHEDULE - 20 : MANUFACTURING & OTHER EXPENSES Power & Fuel Stores & Spares Consumed Laboratory Goods & Testing Expenses Labour and Job Work Charges Excise Duty Repairs & Maintenance : Machinery Buildings Others Selling, Publicity & Medical Literature Expenses Commission on sales [after adjusting excess provision of earlier years written back Rs lacs (previous year Rs lacs)] Sales & Turnover Taxes Provision for Doubtful Debts Bad Debts written off Travelling, Conveyance & Vehicle Expenses Stationary Printing & Communication Expenses Insurance Rent Rates & Taxes Lease Rent Auditors Remuneration & Expenses Directors Sitting Fees Net Foreign Exchange Loss Exchange loss on Translation General Charges Donation Preliminery Expenses SCHEDULE - 21 : NET INTEREST INCOME Received (Tax deducted at source Rs lacs, Previous Year Rs lacs) Paid Fixed Period Loans Others

10 Torrent Pharmaceuticals Limited Year ended Year ended SCHEDULE - 22 : EXCEPTIONAL ITEMS Income: Excess provision for diminution in value of investments written back [see note 7(b)] Expenditure: Provision for diminution in value of investments [see note 7(a)] Contractual Penalty [see note 7(b)] (155.60) 0.00 SCHEDULE - 23 : NOTES TO THE CONSOLIDATED ACCOUNTS 1. Details of Subsidiaries: a) The consolidated financial statements include the financial statements of the parent company, Torrent Pharmaceuticals Ltd. (TPL) and the following subsidiaries: Name of Subsidiary Country of incorporation Controlling Stake Zao Torrent Pharma Russia 100% Torrent Do Brasil Ltda (TDBL) Brazil 100% Torrent Pharma GmbH (TPG) Germany 100% Torrent Pharma Inc. (TPI) USA 100% TPL Finance Ltd India 100% b) Torrent Pharma Inc. was incorporated on 13 th January 2004 as a wholly owned subsidiary of Torrent Pharmaceuticals Ltd. 2. Basis of preparation: The consolidated financial statements have been prepared by consolidating the accounts of TPL with those of its subsidiaries in accordance with generally accepted accounting principles and in consonance with Accounting Standard 21 (Consolidated financial Statements) issued by the Institute of Chartered Accountants of India. These statements have been prepared to meet the requirement of Clause 32 of the listing agreement with the stock exchange. 3. Principles of consolidation The consolidated financial statements comprise the financial statements of Torrent Pharmaceuticals Ltd and its wholly owned subsidiaries. All inter-company balances and transactions are eliminated on consolidation. The statements have been prepared based on a line-by-line consolidation of profit and loss account and balance sheet. The financials of TPI have been consolidated for the post incorporation period commencing from 13 th January (a) Significant accounting policies of the group The accounting policies adopted by TPL have been detailed in Schedule 22 to the attached accounts of TPL. The accounting policies adopted by the subsidiaries are the same as that of TPL. The following accounting policies are additionally applicable for the consolidated financial statements. (b) Foreign Currency Translation Translation is effected according to Accounting Standard 11 (Revised 2003). Considering the information related to the indicators relevant for classification of an overseas operation, operations of all overseas subsidiaries are treated as integral to that of the parent and accordingly translation is effected as follows. i) Revenues and expenses of subsidiaries are translated at the average exchange rates based on the monthly closing rates for the year st annual report 75

11 ii) Monetary assets and liabilities are translated at exchange rate prevalent at the date of the balance sheet. The resulting differences are recognized as exchange gain/loss in the profit and loss account. iii) Non-monetary assets and liabilities are translated at actual exchange rate and/or a rate that approximates the actual exchange rate at the date of the transaction. (c) Acquisition and Goodwill The excess of cost of acquisition over book values of assets on the date of acquisition has been recognized as Goodwill and amortized over a period of five years. 5. (a) During the year, the Company has adopted the practice of disclosing Sales after excluding Sales Tax / VAT collected thereon. Excise Duty/ICMS collected on Sales is shown by way of further deduction from Sales. Hitherto the reporting practice was to disclose Sales including Excise Duty/ICMS and Sales Tax/VAT collected thereon, whilst separately disclosing Excise Duty/ICMS and Sales Tax/VAT collected on Sales in the Notes. The change in reporting practice has been effected for corresponding previous periods also for comparison and has been adopted to bring it in line with recommended practice. The change has no impact on the profits for any of the reported periods. (b) During the year, the Company has revised the estimated useful life of information technology assets, other than computer software capitalised, to 3 years, considering the faster technological obsolescence, wear and tear of such assets. During the earlier periods, the depreciation was charged as per rates prescribed in Schedule XIV of the Companies Act, 1956 with an implied estimated useful life of 5.86 years. Due to this change: - the depreciation for the current year is higher by Rs lacs - the deferred tax liability adjustment for the current year is lower by Rs lacs - the net profit for the current year is lower by Rs lacs - the reserves and surplus is lower by Rs lacs and - the net block of fixed assets is lower by Rs lacs. (c) During the year the policy relating to treatment of expenditure incurred for procuring, developing, improving and maintaining computer software programs has been changed to bring it in accordance with the new accounting standard AS-26 Intangible Assets. Due to this change: - the general charges for the current year are lower by Rs Lacs - the depreciation charge for the current year is higher by Rs Lacs - deferred tax liability is higher by Rs Lacs - the net profit for the current year is higher by Rs Lacs - the reserves and surplus is higher by Rs Lacs; and - net block of fixed assets is higher by Rs Lacs Estimated amount of contracts remaining to be executed on capital account and not provided for (a) During the year, based on a review of the quality of the long-term investment, full provision for carrying cost of Rs (Previous Year NIL) lacs has been made for permanent diminution in value of equity shares of Charterhouse Therapeutics Limited, UK. The provision has been disclosed as Exceptional item. (b) During the year , the Company provided for the carrying cost of Rs lacs in respect of long term equity investment in JSC Pharmimex ( JSC ), Russia for permanent diminution in value of the investment. JSC asserted certain contractual claims against the Company of Rs lacs for delay in supplies. The Company settled the same by way of set-off against sale of its equity investment in JSC. The resultant excess provision and claim expense are treated as exceptional items. 8. The credit balance of Rs lacs in Deferred Tax Adjustment Account as at 31-Mar-2004 comprises of: Deferred tax liability Excess of depreciation claimed under the income-tax law over that debited to profit & loss account in the earlier years

12 Torrent Pharmaceuticals Limited Deferred tax asset Provision for Leave salary (77.90) (71.23) Provision for Doubtful debts (2.32) (53.88) Bonus Payable (3.77) 0.00 Accumulated loss of TDBL (590.58) (444.75) Accumulated loss of Zao TP (1.51) 0.00 Net Deferred tax liability Contingent liabilities not provided for: Disputed demand of Income Tax for which an appeal has been preferred Disputed demand of Excise Disputed ESI Liability (a) Sales of TPL include inter unit transfer for captive consumption amounting to Rs lacs (previous year Rs lacs). (b) Other Operating Income of TPL for the year include Rs lacs (previous year Rs. Nil) compensation arising on termination of certain agreements with a party prior to the contractual term, based on mutual consent. 11. (a) Research and Development expenses comprise: Personnel costs: Salaries, wages and bonus Contribution to Provident Gratuity and other funds Welfare expenses Power & fuel Stores & spares consumed Laboratory goods & testing expenses Repairs & Maintenance Clinical research expenses Traveling, conveyance & vehicle expenses General charges (b) Depreciation and Amortisation includes Rs Lacs (previous year Rs Lacs) pertaining to Research and Developments assets. 12. The basic & diluted earnings per share are : Profit after Tax and before exceptional items (a) Net profit for the period (Rs. In lacs) (b) Weighted average no of Equity Shares (No. in Lacs) (c) EPS Basic and Diluted in Rs. (b)/(c) EPS (basic & diluted, profit after tax and before exceptional items) in Rs. (a)/(c) Nominal value of shares (211.6 lacs shares of Rs 10 each) st annual report 77

13 13. The disclosures pertaining to related parties and transactions therewith for the group are the same as set out in schedule 23 of the attached accounts of TPL. 14. Segment reporting The primary and secondary reportable segments considered are Business Segments and Geographical Segments respectively. The group operates in a solitary business segment i.e. pharmaceuticals, comprising mainly manufacture of branded formulations. Accordingly, no further financial information for Business Segments is given. Reportable Geographical Segments have been identified based on location of customers and the operating results for each location in the previous year. Hence, the disclosure of geographical segments is continued in the current year notwithstanding that its operating result no longer meets disclosure criteria. Sales are made in various geographies with production based in India. The reportable Geographical Segments are: a) India b) Brazil c) Rest of the world Segment revenue (external net sales) for the year is as under: India Brazil Rest of the world Total Segment assets are not directly identifiable / properly allocable against each of the above reportable segments Fixed assets, forming a substantial portion of the total assets of the Company, are interchangeably used between all the segments and cannot be identified against a specific segment. Significant portion of current assets are interchangeable between all the segments and not identifiable against any individual segment. Hence no meaningful disclosure of segment assets is possible. 15. Previous figures have been regrouped wherever necessary so as to make them comparable with those of the current year. As per our attached report of even date Signatures to Schedule 1 to 23 For C. C. CHOKSHI & CO. Chartered Accountants Samir Mehta Managing Director V. J. Shah Mahesh Agrawal Markand Bhatt Partner GM (Legal) & Director Membership No Company Secretary Ahmedabad Ahmedabad 10 June, June, 2004 Note : The Department of Company Affairs has, for the financial year , exempted the Company from the applicability of the provisions contained in sub-section (1) of section 212 of the Companies Act, 1956, relating to the statements to be attached in respect of the subsidiary companies, with the financial statements of the Company. Shareholders interested in obtaining the statement of Company s interest in the subsidiaries or standalone financial statements of the subsidiaries may obtain it by writing to the Company Secretary. 78