GSK_ Annual_Report_2021-22

Notes to the Consolidated Financial Statements for the year ended March 31, 2022 209 Note 1: Significant accounting policies A. GENERAL INFORMATION GlaxoSmithKline Pharmaceuticals Limited (‘the Group’) is a public company domiciled in India and is incorporated under the provisions of the Companies Act applicable in India. Its shares are listed on the BSE Ltd. (Bombay Stock Exchange) and the National Stock Exchange of India Ltd. (NSE). The registered office of the company is located at Dr. Annie Besant Road, Worli, Mumbai 400 030. The Group is engaged interalia, in the business of manufacturing, distributing and trading in pharmaceuticals. The subsidiary considered in these Consolidated Financial Statements is: Name of the Company Country of Incorporation % voting power held as at March 31, 2022 % voting power held as at March 31, 2021 Biddle Sawyer Limited (BSL) India 100.00 100.00 B. SIGNIFICANT ACCOUNTING POLICIES a) Basis of preparation The Consolidated Financial Statements of the Group have been prepared in accordance with Indian Accounting Standards (“Ind AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 and relevant provisions of the Companies Act, 2013 (“the Act”) (as amended from time to time). The Consolidated Financial Statements have been prepared on a historical cost basis, except for the following: • certain financial assets and liabilities that are measured at fair value; • assets held for sale - measured at lower of carrying amount or fair value less cost to sell; • defined benefit plans - plan assets measured at fair value; and • share-based payments. The financial statements are presented in INR and all values are rounded to the nearest lakhs (INR 00,000), except where otherwise indicated. b) Principles of consolidation The Consolidated Financial Statement have been prepared on the following basis: • The Group combines the financial statements of the parent and its subsidiary line by line adding together like items of assets, liabilities, equity, income and expenses. Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiary have been changed where necessary to ensure consistency with the policies adopted by the group. • The Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and other events in similar circumstances and are presented to the extent possible, in the same manner as the Company’s separate financial statements. • The excess of cost to the Company of its investment in the subsidiary is recognised in the financial statements as goodwill, which has been amortised over a period of ten years. • If the difference of the aggregate of the consideration transferred, the amount recognised for noncontrolling interests and any previous interest held, over the net identifiable assets acquired and liabilities assumed is a deficit then the said deficit is recognized as a capital reserve. c) Revenue recognition Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price (net of variable consideration) allocated to that performance obligation. The transaction price of goods sold and services rendered is net of variable consideration on account of various discounts and schemes offered by the Group as part of the contract. This variable consideration is estimated based on the expected value of outflow. Revenue (net of variable consideration) is recognized only to the extent that it is highly probable that the amount will not be subject to significant reversal when uncertainty relating to its recognition is resolved. The specific recognition criteria described below must also be met before revenue is recognised. Sale of goods Revenue from the sale of goods is recognised when the goods have been passed on to the buyer as per contractual terms, at which time all the following conditions are satisfied: