Mar 31, 2023
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of GLAXOSMITHKLINE PHARMACEUTICALS LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2023, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matter described below to be the key audit matter to be communicated in our report.
Sr. No. |
Key Audit Matter |
Auditorâs Response |
1 |
Information |
Principal audit procedures |
Technology (IT) |
performed with the assistance |
|
systems which impact financial |
of our IT specialists: |
|
reporting |
⢠We identified the IT risks for each IT system based on |
|
The IT systems of |
our understanding of the |
|
the Company form |
flows of transactions and |
|
a critical component of the Company''s |
the IT environment. |
|
financial reporting |
⢠We determined whether |
|
activities and impact |
each general IT control, |
|
all account balances. |
individually or in |
|
IT controls, in the |
combination with other |
|
context of our scope |
controls, is appropriately |
|
for the financial |
designed to address the |
|
audit, primarily relate |
associated IT risk. |
|
to access security |
⢠We tested the design, |
|
and change control. |
implementation and |
|
The purpose of such controls is to |
operating effectiveness of the relevant general IT |
|
prevent inappropriate changes being made |
controls. |
|
to IT systems in |
⢠We tested the mitigating |
|
relation to application |
manual controls for the IT |
|
functionality, |
control deficiencies noted |
|
transactional |
around privilege access |
|
processing and direct |
for certain scoped-in IT |
|
changes to underlying |
systems and the associated |
|
data. |
infrastructure. |
Information Other than the Financial Statements and Auditorâs Report Thereon
⢠The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility and Sustainability Report
and Corporate Governance in Annual Report, but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon.
⢠Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
⢠In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information
is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
⢠If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Company''s Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit.
We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)® of the Act, we are also responsible for expressing our opinion
on whether the Company has adequate internal financial controls with reference to standalone financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters.
We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. In our opinion, proper books of account as required by law have been kept by the company so far as it appears from our examination of those books, except for keeping backup on daily basis of such books of
account maintained in electronic mode in a server physically located in India (refer Note 60 to the financial statements).
c. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
e. On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 from being appointed as a director in terms of Section 164(2) of the Act.
f. The observation relating to the maintenance of accounts and other matters connected therewith, are as stated in paragraph (b) above
g. With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls with reference to standalone financial statements.
h. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended,
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
i. With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements. Refer Note 41 to the standalone financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that, to the
best of it''s knowledge and belief, as disclosed in the note 58(iii) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The Management has represented, that, to the best of it''s knowledge and belief, as disclosed in the note 58(iv) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under subclause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.
As stated in note 59 to the standalone financial statements, the Board of Directors of the Company has proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend proposed is in accordance with section 123 of the Act, as applicable.
2. As required by the Companies (Auditor''s Report) Order,
2020 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants (Firm''s Registration No. 117366W/W-100018)
Rupen K. Bhatt
Partner
Place: Mumbai (Membership No. 0446930)
Date: May 17, 2023 (UDIN: 23046930BGXRKH6255)
Mar 31, 2022
Report on the Audit of the Standalone Financial StatementsOpinion
We have audited the accompanying standalone financial statements of GLAXOSMITHKLINE PHARMACEUTICALS LIMITED (âthe Companyâ), which comprise the Balance Sheet as at March 31,2022, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2022, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sr. No. |
Key Audit Matter |
Auditorâs Response |
i |
Information Technology |
Principal audit procedures |
(IT) systems which |
performed with the assistance of |
|
impact financial |
our IT specialists: |
|
reporting |
⢠We identified the IT risks for |
|
The IT systems of |
each IT system based on our |
|
the Company form a |
understanding of the flows |
|
critical component of |
of transactions and the IT |
|
the Company''s financial |
environment. |
|
reporting activities |
⢠We determined whether each |
|
and impact all account balances. IT controls, in |
general IT control, individually or in combination with other controls, is |
|
the context of our scope for the financial audit, |
appropriately designed to address the associated IT risk. |
|
primarily relate to access security and change control. The purpose of such controls is to prevent inappropriate changes being made to IT systems in relation to application functionality, transactional processing and direct changes to underlying data. |
⢠We tested the design, implementation and operating effectiveness of the relevant general IT controls. ⢠We tested the mitigating manual controls for the IT control deficiencies noted around privilege access for certain scoped-in IT systems and the associated infrastructure. |
Information Other than the Financial Statements and Auditorâs Report Thereon
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Corporate Governance and Shareholders Information in Annual Report, but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon.
⢠Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
⢠In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
⢠If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Managementâs Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters.
We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our
audit, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
e. On the basis of the written representations received from the directors as on March 31,2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2022 from being appointed as a director in terms of Section 164(2) of the Act.
f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer
to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.
g. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended,
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h. With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements.
ii. The Company has long term contracts as of March 31,2022 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31,2022.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. (a) The Management has represented that,
to the best of its knowledge and belief, as disclosed in the note 59(iii) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The Management has represented, that, to the best of its knowledge and belief, as disclosed in the note 59 (iv)s to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including
foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under subclause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.
As stated in note 60 to the standalone financial statements, the Board of Directors of the Company have proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend proposed is in accordance with section 123 of the Act, as applicable.
2. As required by the Companies (Auditor''s Report) Order, 2020 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants (Firm''s Registration No. 117366W/W-100018)
Rupen K. Bhatt
Partner
Place: Mumbai (Membership No. 046930)
Date: May 16, 2022 (UDIN: 22046930AJAKLR8629)
Mar 31, 2021
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2021, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2021, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sr. No. |
Key Audit Matters |
Auditorâs Response |
1 |
Information Technology (IT) systems which impact financial reporting The IT systems of the Company form a critical component of the Company''s financial reporting activities and impact all account balances. IT controls, in the context of our scope for the financial audit, primarily relate to access security and change control. The purpose of such controls is to prevent inappropriate changes being made to IT systems in relation to application functionality, transactional processing and direct changes to underlying data. |
Principal audit procedures performed with the assistance of our IT specialists: ⢠We identified the IT risks for each IT system based on our understanding of the flows of transactions and the IT environment. ⢠We determined whether each general IT control, individually or in combination with other controls, is appropriately designed to address the associated IT risk. ⢠We tested the design, implementation and operating effectiveness of the relevant general IT controls. ⢠We tested the mitigating manual controls for the IT control deficiencies noted around privilege access for certain scoped-in IT systems and the associated infrastructure. |
Information Other than the Financial Statements and Auditorâs Report Thereon
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Corporate Governance and Shareholders Information in Annual Report, but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon.
⢠Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
⢠In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
⢠If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Managementâs Responsibility for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgement and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit, we report that:
a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c. The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
e. On the basis of the written representations received from the directors as on March 31, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 from being appointed as a director in terms of Section 164(2) of the Act.
f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.
g. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended,
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h. With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements.
ii. The Company has long term contracts as of March 31, 2021 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2021.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditor''s Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants (Firm''s Registration No. 117366W/W-100018)
Rupen K. Bhatt
Partner
(Membership No. 046930) (UDIN: 21046930AAAACB2367)
Place : Mumbai Date : May 18, 2021
Mar 31, 2019
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2019, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (âthe Actâ) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (âInd ASâ) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Basis For Opinion
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). Our responsibilities under those Standards are further described in the Auditorâs Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAIâs Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sr. No. |
Key Audit Matter |
Auditorâs Response |
1 |
Information Technology (IT) systems which impact financial reporting |
Principal audit procedures performed with the assistance of our IT specialists: |
The IT systems of the Company form a critical component of the Companyâs financial reporting activities and impact all account balances. IT controls, in the context of our scope for the financial audit, primarily relate to access security and change control. The purpose of such controls is to prevent inappropriate changes being made to IT systems in relation to application functionality, transactional processing and direct changes to underlying data. |
- We identified the IT risks for each IT system based on our understanding of the flows of transactions and the IT environment. - We determined whether each general IT control, individually or in combination with other controls, is appropriately designed to address the associated IT risk. - We tested the design, implementation and operating effectiveness of the relevant general IT controls. - We tested the mitigating manual controls for the IT control deficiencies noted around privilege access for certain scoped-in IT systems and the associated infrastructure. |
2 |
Uncertain tax positions |
Principal audit procedures performed: |
The Company operates in a complex tax environment and is subject to a range of tax risks during the normal course of business. The arrangements for multinational transactions entered into by the Company are complex, judgmental and subject to challenge by the Tax Authorities. Further, the allowability of certain expenses and admission of additional supporting documents by the Company is also a matter of ongoing dispute with the authorities. Refer notes 40A(ii)(a) and 40A(iii) to the standalone financial statements |
- We evaluated and tested the design and operating effectiveness of the Companyâs controls over provisions for uncertain tax positions to ensure that they operate effectively. - With the assistance of our tax specialists, we evaluated managementâs judgements in respect of estimates of tax exposures and contingencies in order to assess the adequacy of the Companyâs tax provisions. - In understanding and evaluating managementâs judgements, we considered the status of recent and current tax authority audits and enquiries, judgmental positions taken in tax returns and current year estimates and developments in the tax environment. |
|
3 |
Litigations |
Principal audit procedures performed: |
The Company operates in an industry which is heavily regulated, which increases inherent litigation risk. The Company is engaged in a number of legal actions, including pricing matters and labour matters. Refer notes 40A(ii)(d) and 41 to the standalone financial statements. |
- We evaluated and tested the design and operating effectiveness of the Companyâs controls in respect of the determination of the provisions to ensure that they operate effectively. - We read the summary of litigation matters provided by management and held discussions with the Companyâs legal counsel. We requested confirmations from some of the Companyâs external legal advisors with respect to the matters included in the summary. - We examined correspondence connected with the cases. To evaluate the valuation and completeness of the provision recognized by the Company, we tested the calculation of the provisions. - We also evaluated adjustments to legal provisions along with the Probable, Possible and Remote analysis prepared by the Company. |
Information Other than the Standalone Financial Statements and Auditorâs Report Thereon
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Boardâs Report including Annexures to Boardâs Report, Corporate Governance and Shareholders Information, but does not include the standalone financial statements and our auditorâs report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Managementâs Responsibility for the Standalone Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditorâs report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
- Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
- Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March 31, 2019 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with the requirements of section 197(16) of the Act, as amended,
In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements.
ii. The Company has long term contracts as of March 31, 2019 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2019.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
ANNEXURE âAâ TO THE INDEPENDENT AUDITORâS REPORT
(Referred to in paragraph 1(f) under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of GLAXOSMITHKLINE PHARMACEUTICALS LIMITED (âthe Companyâ) as of March 31, 2019 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting of the Company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained, is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2019, based on the criteria for internal financial control over financial reporting established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
ANNEXURE âBâ TO THE INDEPENDENT AUDITORâS REPORT
(Referred to in paragraph 2 under âReport on Other Legal and Regulatory Requirementsâ section of our report of even date)
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the property, plant and equipment.
(b) The property, plant and equipment were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) With respect to immovable properties of acquired land and buildings that are freehold/leasehold, according to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed / transfer deed / conveyance deed / court orders approving schemes of arrangements / amalgamations provided to us, we report that, the title deeds of such immovable properties are held in the name of the Company as at the balance sheet date.
(ii) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013.
(iv) The Company has not granted any loans, made investments, provided guarantees or security and hence reporting under clause (iv) of the CARO 2016 is not applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year within the meaning of the provisions of Sections 73 and 76 or any other relevant provisions of the Companies Act, 2013. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.
(vi) The maintenance of cost records has been specified by the Central Government under Section 148(1) of the Companies Act, 2013 in respect of its products. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (cost records and audit) Rules, 2014 and amended Companies (cost records and audit) Amendment Rules, 2016 as prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us, in respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employeesâ State Insurance, Income-tax, Goods and Service Tax, Customs Duty, Cess and other material statutory dues applicable to it to the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-tax, Goods and Service Tax, Customs Duty, Cess and other material statutory dues in arrears as at March 31, 2019 for a period of more than six months from the date they became payable.
(c) Details of dues of Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty and Value Added Tax which have not been deposited as on March 31, 2019 on account of disputes are given below:
Name of the Statue |
Nature of Dues |
Forum where dispute is pending |
Period to which the amount relates# |
Amount (Rs. in Lakhs) |
Income - tax Act, 1961 |
Income-tax |
Commissioner of Income Tax (Appeals) |
2006-07, 2007-08, 201112 to 2014-15 |
76,37.59 |
Income Tax Appellate Tribunal |
1989-90 |
36.92 |
||
High Court |
1993-94 |
20.43 |
||
Sub-total |
76,94.94* |
|||
The Central Excise Act, 1944 |
Excise Duty |
Appellate Authority - up to Commissioners / Revisional authorities Level |
1991-92 to 1993-94, 1995-96 to 1997-98 |
14.89 |
Customs, Excise and Service Tax Appellate Tribunal |
1996-97 to 2002-03, 2007-08, 2010-11 to 2012-13 |
4,38.95 |
||
High Court |
1976-77 to 1980-81, 1987-88 to 1991-1992 |
1,60.83 |
||
Sub-total |
6,14.67 |
|||
Custom Act, 1962 |
Custom Duty |
Appellate Authority - up to Commissioners / Revisional authorities Level |
1992-93, 1993-94 |
10.71 |
Customs, Excise and Service Tax Appellate Tribunal |
1994-95 |
66.53 |
||
Sub-total |
77.24 |
|||
Finance Act, 1994 |
Service Tax |
Customs, Excise and Service Tax Appellate Tribunal |
2000-01, 2002-03 |
1,29.20 |
Sub-total |
1,29.20 |
|||
Sales Tax and Laws as per statues applicable in various states |
Sales Tax and VAT |
Appellate Authority - up to Commissioners / Revisional authorities Level |
1983-84, 1987-88 to 1994-95, 1996-97 to 2006-2017 |
36,22.71 |
Appellate Authority -Tribunal |
1990-91, 1998-1999, 1999-2000, 2001-02, 2002-03, 2005-06 to 2007-08, 2009- 10, 2010 -2011, 2012-13, 2006-07 to 2009-10 |
107,79.77 |
||
High Court |
1990-91, 1999-2000, 2001-02 to 2005-06 |
1,20.12 |
||
Supreme Court |
1993-94, 1994-95 |
42.14 |
||
Sub-total |
145,64.74A |
|||
Total |
230,80.79 |
# generally, the year refers to financial year i.e. April to March
* Net of Rs. 12,67.20 Lakhs paid under protest A Net of Rs. 22,31.14 Lakhs paid under protest
Out of the total disputed amounts of Rs. 230,80.79 Lakhs as above, Rs. 136,16.75 Lakhs has not been deposited due to stay orders.
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans to government.
(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under clause (ix) of the CARO 2016 Order is not applicable.
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us, the Company has paid / provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Sections 188 and 177 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of its subsidiary company or persons connected with them and hence the provisions of Section 192 of the Companies Act, 2013 are not applicable.
(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.
For DELOITTE HASKINS AND SELLS LLP
Chartered Accountants
(Firmâs Registration No. 117366W/W-100018)
B. P. SHROFF
Partner
(Membership No. 34382)
Place: Mumbai
Date: May 20, 2019
Mar 31, 2018
INDEPENDENT AUDITORâS REPORT
TO THE MEMBERS OF GLAXOSMITHKLINE PHARMACEUTICALS LIMITED
Report on the Standalone Ind As Financial Statements
We have audited the accompanying standalone Ind AS financial statements of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and Fairview and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under and the Order issued under section 143(11)of the Act.
We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the Ind AS and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on our audit, we report to the extent applicable that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act.
e) On the basis of the written representations received from the directors of the Company as on March 31,2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2018 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure Aâ. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companyâs internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements.
ii. The Company has long term contracts as of March 31, 2018 for which there were no material foreseeable losses.
The Company did not have any derivative contracts as at March 31, 2018.
Hi. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
2. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ) issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure Bâ a statement on the matters specified in paragraphs 3 and 4 of the Order.
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (âthe Actâ)
We have audited the internal financial controls over financial reporting of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
The Companyâs management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditorâs Responsibility
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting of the Company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Companyâs internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A companyâs internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the criteria for internal financial control over financial reporting established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of the property, plant and equipment.
(b) The property, plant and equipment were physically verified during the year by the Management in accordance with a regular programme of verification which, in our opinion, provides for physical verification of all the fixed assets at reasonable intervals. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) With respect to immovable properties of acquired land and buildings that are freehold/leasehold, according to the information and explanations given to us and the records examined by us and based on the examination of the registered sale deed / transfer deed / conveyance deed / court orders approving schemes of arrangements/ amalgamations provided to us, we report that, the title deeds of such immovable properties are held in the name of the Company as at the balance sheet date.
(ii) As explained to us, the inventories were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013.
(iv) The Company has not granted any loans, made investments, provided guarantees or security and hence reporting under clause (iv) of the CARO 2016 is not applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year within the meaning of the provisions of Sections 73 and 76 or any other relevant provisions of the Companies Act, 2013. According to the information and explanations given to us, no order has been passed by the Company Law Board or the National Company Law Tribunal or the Reserve Bank of India or any Court or any other Tribunal.
(vi) The maintenance of cost records has been specified by the Central Government under Section 148(1) of the Companies Act, 2013 in respect of its products. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (cost records and audit) Rules, 2014 and amended Companies (cost records and audit) Amendment Rules, 2016 as prescribed by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and are of the opinion that prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.
(vii) According to the information and explanations given to us, in respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employeesâ State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues applicable to it to the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues in arrears as at March 31,2018 for a period of more than six months from the date they became payable.
(c) Details of dues of Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, and Value Added Tax which have not been deposited as on March 31, 2018 on account of disputes are given below:
Name of the Statue |
Nature of Dues |
Forum where dispute is pending |
Period to which the amount relates# |
Amount (Rs, in Lakhs) |
Income - tax Act, 1961 |
Income-tax |
Commissioner of Income Tax (Appeals) |
2006-07, 2007-08, 2011-12 to 2013-14 |
62,25.53 |
Income Tax Appellate Tribunal |
1989-90 |
36.92 |
||
High Court |
1993-94 |
20.43 |
||
Sub-total |
62,82.88* |
|||
The Central Excise Act, 1944 |
Excise Duty |
Appellate Authority - up to Commissioners / Provisional authorities Level |
1991-92 to 1993-94, 1995-96 to 1997-98 |
14.89 |
Customs, Excise and Service Tax Appellate Tribunal |
1996-97 to 2002-03, 2007-08, 2010-11 to 2012-13 |
4,77.37 |
||
High Court |
1976-77 to 1980-81, 1987-88 to 1991-1992 |
1,60.83 |
||
Sub-total |
6,53.09 |
|||
Custom Act, 1962 |
Custom Duty |
Appellate Authority - up to Commissioners / Provisional authorities Level |
1992-93, 1993-94 |
10.71 |
Customs, Excise and Service Tax Appellate Tribunal |
1994-95 |
66.53 |
||
Sub-total |
77.24 |
|||
Finance Act, 1994 |
Service Tax |
Customs, Excise and Service Tax Appellate Tribunal |
2000-01,2002-03 |
1,29.20 |
Sub-total |
1,29.20 |
|||
Sales Tax and Laws as per statues applicable in various states |
Sales Tax and VAT |
Appellate Authority - up to Commissioners / Revisional authorities Level |
1983-84, 1987-88 to 1994-95, 1996-97 to 2006-07, 2008-09 to 2015-16 |
35,30.72 |
Appellate Authority -Tribunal |
1990-91, 1998-99, 1999-2000, 2001-02, 2002-03, 2005-06 to 2010-11,2012-13 |
107,61.77 |
||
High Court |
1990-91, 1999-2000, 2001-02 to 2005-06 |
1,20.12 |
||
Supreme Court |
1993-94, 1994-95 |
42.14 |
||
Sub-total |
144,54.75 |
|||
Total |
215,97.16 |
# generally, the year refers to financial year i.e. April to March
* Net of- 12,04.16 Lakhs paid under protest A Net ofRs, 21,46.38 Lakhs paid under protest
Out of the total disputed amounts of 215,97.16 Lakhs as above, 52,18.20 Lakhs has not been deposited due to stay orders.
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans to government.
(ix) The Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) or term loans and hence reporting under clause (ix) of the CARO 2016 Order is not applicable.
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) In our opinion and according to the information and explanations given to us, the Company has paid I provided managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.
(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the CARO 2016 Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us the Company is in compliance with Sections 188 and 177 of the Companies Act, 2013, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause (xiv) of CARO 2016 is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or directors of its subsidiary company or persons connected with them and hence the provisions of section 192 of the Companies Act, 2013 are not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firmâs Registration No. 117366W/W-100018)
B. P. SHROFF
Place: Mumbai Partner
Date: May 24, 2018 Membership No. 34382
Mar 31, 2017
TO THE MEMBERS OF GLAXOSMITHKLINE PHARMACEUTICALS LIMITED
Report on the Standalone Indian Accounting Standards (Ind AS) financial Statements
1. We have audited the accompanying standalone financial statements of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone Ind AS financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified in the Companies (Indian Accounting Standards) Rules, 2015 (as amended) under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made there under including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
5. We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
6. An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
7. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
8. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, and its profit (including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Other Matter
9. The financial information of the Company for the year ended March 31, 2016 and the transition date opening balance sheet as at April 1, 2015 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements for the years ended March 31, 2016 and March 31, 2015 prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) which were audited by us, on which we expressed an unmodified opinion dated May 25, 2016 and May 18, 2015 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the Company on transition to the Ind AS have been audited by us.
Our opinion is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditor''s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act (âthe Orderâ), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order.
11. As required by Section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
(c) The Balance Sheet, the Statement of Profit and Loss (including other comprehensive income), the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(g) With respect to the other matters to be included in the Auditors'' Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i. The Company has disclosed the impact, if any, of pending litigations as at March 31, 2017 on its financial position in its standalone Ind AS financial statements - Refer Notes 42 (A), 43, 44 and 45.
ii. The Company has long-term contracts as at March 31, 2017 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2017.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2017.
iv. The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Management - Refer Note 41.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of GlaxoSmithKline Pharmaceuticals Limited (âthe Companyâ) as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under Section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial Reporting
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets, other than the situation of certain plant and equipment, furniture and office equipment, for which the situation recorded, is the location of the Company''s different establishments.
(b) The fixed assets are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties, as disclosed in Note 3 and Note 4 to the financial statements, are held in the name of the Company.
ii. The physical verification of inventory excluding stocks with third parties have been conducted at reasonable intervals by the Management during the year. In respect of inventory lying with third parties, these have substantially been confirmed by them. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)
(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. The Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under Section 185 and 186. Therefore, the provisions of Clause 3(iv) of the said Order are not applicable to the Company.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our
opinion, the Company is generally regular in depositing undisputed statutory dues in respect of professional tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues in respect of provident fund, employees'' state insurance, income tax, value added tax, service tax, duty of customs, duty of excise, cess and other statutory dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of duty of customs which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax including value added tax, service tax and duty of excise as at March 31, 2017 which have not been deposited on account of a dispute, are as follows:
Name of the statute |
Nature of dues |
Amount (Rs, in lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Income Tax Act, 1961 |
Income tax including interest as applicable. |
23,35.72 |
Several demands pertaining to Assessment years 2005-2006 to 2016-17 |
Appellate Authority - up to CommissionerRs,s level |
36.92 |
Assessment years 1990-1991 |
Tribunal |
||
20.43 |
Assessment year 1994-95 |
High Court, Bombay |
Name of the statute |
Nature of dues |
Amount (Rs, in lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Central Sales Tax Act, 1956 and Local Sales Tax Acts |
Sales-tax, including interest and penalty, as applicable |
278,29.13 |
Several demands pertaining to the period 1983-1984 and 1988 to 2015. |
Appellate Authority - up to Commissioner''s level |
54,79.62 (includes Rs, 52,18.20 lakhs not deposited due to a stay order) |
Several demands pertaining to the period 1990-1991,1998-1999, 1999-2000,2001-2002 to 2005-2006. |
Tribunal |
||
83.08 |
Several demands pertaining to the period 1990-1991, 1999-2000 and 2001-2002. |
The High Court of Judicature at Allahabad, Lucknow and Kerala |
||
42.14 |
Demand pertaining to the period 1993-1994 and 1994-1995 |
Supreme Court |
||
The Finance Act, 1994 |
Service Tax |
1,29.20 |
January 2001 to December 2002 |
Customs, Excise & Service Tax Appellate Tribunal |
The Central Excise Act, 1944 |
Excise duty, including interest and penalty, as applicable |
25.60 |
Several demands pertaining to the periods March 1992 to March 1994, July 1995 to January 1998. |
Appellate Authority - up to Commissioner''s level |
18,09.71 |
Several Demands Pertaining to the period October 1994 to January 1995, September 1996 to September 2002, November 2003 to December 2011, September 2012 to March 2013 |
Customs, Excise & Service Tax Appellate Tribunal (CESTAT) |
||
1,60.83 |
Demand pertaining to 1977-1980 and 1988-1991 |
The High Court of Judicature at Bombay |
viii. According to the records of the Company examined by us and the information and explanation given to us, the Company has not defaulted in repayment of loans or borrowings to any financial institution or bank or Government or dues to debenture holders as at the balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24 - Related Party Disclosures specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015.
xiv. The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review. Accordingly, the provisions of Clause 3(xiv) of the Order are not applicable to the Company.
xv. The Company has not any entered into non cash transaction with its directors or persons connected within the meaning of Section 192 of the Act. Accordingly, the provisions of Clause 3(xv) of the Order are not applicable to the Company.
xvi. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.
For Price Waterhouse & Co Bangalore LLP
Firm Registration Number: 007567S/S-200012
Chartered Accountants
Asha Ramanathan
Mumbai Partner
May 19, 2017 Membership Number: 202660
Mar 31, 2015
1. We have audited the accompanying financial statements of
GlaxoSmithKline Pharmaceuticals Limited (the "Company"), which
comprise the Balance Sheet as at March 31, 2015, the Statement of
Profit and Loss for the 15 months period from January 1, 2014 to March
31, 2015 (the "period") and Cash Flow Statement for the period then
ended, and a summary of significant accounting policies and other
explanatory information, which we have signed under reference to this
report.
Management''s Responsibility for the Financial Statements
2. The Company''s Management is responsible for the preparation of these
financial statements that give a true and fair view of the financial
position, financial performance and cash flows of the Company in
accordance with the Accounting Standards notified under the Companies
Act, 1956 (the "Act") read with the General Circular 15/2013 dated
September 13, 2013 of the Ministry of Corporate Affairs in respect of
Section 133 of the Companies Act, 2013. This responsibility includes
the design, implementation and maintenance of internal control relevant
to the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing and other applicable authoritative
pronouncements issued by the Institute of Chartered Accountants of
India. Those Standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence,
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors'' judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditors consider internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by Management, as well
as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
6. I n our opinion, and to the best of our information and according to
the explanations given to us, the accompanying financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2015;
(b) in the case of the Statement of Profit and Loss, of the profit for
the period ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
period ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by ''the Companies (Auditor''s Report) Order, 2003'', as
amended by ''the Companies (Auditor''s Report) (Amendment) Order,
2004'', issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act [Section 143(11) of the
Companies Act, 2013] (hereinafter referred to as the "Order"), and
on the basis of such checks of the books and records of the Company as
we considered appropriate and according to the information and
explanations given to us, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the Order.
8. As required by section 227(3) of the Act [Section 143(3) of the
Companies Act, 2013], we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purpose of our
audit;
(b) I n our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Statement of Profit and Loss, and Cash Flow
Statement dealt with by this Report are in agreement with the books of
account;
(d) I n our opinion, the Balance Sheet, Statement of Profit and Loss,
and Cash Flow Statement dealt with by this report comply with the
Accounting Standards notified under the Companies Act, 1956 read with
the General Circular 15/2013 dated September 13, 2013 of the Ministry
of Corporate Affairs in respect of Section 133 of the Companies Act,
2013;
(e) On the basis of written representations received from the directors
as on March 31, 2015, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31,2015, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Act [Section 164(2) of the Companies Act, 2013].
Annexure To Independent Auditors'' Report
Referred to in paragraph 7 of the Independent Auditors'' Report of
even date to the members of GlaxoSmithKline Pharmaceuticals Limited on
the financial statements as of and for the 15 months period ended March
31, 2015
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets, other than the situation of certain plant and equipment,
furniture and office equipment, for which the situation recorded, is
the location of the Company''s different establishments.
(b) The fixed assets of the Company have been physically verified by
the Management according to a phased programme designed to cover all
the items over a period of three years which, in our opinion, is
reasonable having regard to the size of the Company and the nature of
its assets. Pursuant to the programme, a portion of the fixed assets
has been physically verified by the Management during the period and no
material discrepancies have been noticed on such verification.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the period.
ii. (a) The inventory excluding stocks with third parties has been
physically verified by the Management during the period. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
iii. I n our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across, nor have been
informed of, any continuing failure to correct major weaknesses in the
aforesaid internal control system.
iv. According to the information and explanations given to us, there
have been no contracts or arrangements that need to be entered in the
register maintained under Section 301 of the Act [Section 189 of the
Companies Act, 2013].
v. In our opinion, and according to the information and explanations
given to us, the Company has not accepted any deposits from the public
within the meaning of Sections 58A and 58AA of the Act [Section 73, 74,
75 and 76 of the Companies Act, 2013] and the rules framed there under.
vi. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
vii. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act [Section 148(1) of the Companies Act, 2013], and are of the opinion
that, prima facie, the prescribed accounts and records have been made
and maintained. We have not, however, made a detailed examination of
the records with a view to determine whether they are accurate or
complete.
viii. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is generally regular in depositing undisputed statutory dues in respect
of service tax, sales tax and professional tax, though there has been a
slight delay in a few cases, and is regular in depositing undisputed
statutory dues, including provident fund, investor education and
protection fund, employees'' state insurance, income tax, wealth tax,
customs duty, excise duty and other material statutory dues, as
applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth tax
and custom duty which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, service tax
and excise duty as at March 31, 2015 which have not been deposited on
account of a dispute, are as follows:
Name of the statute Nature of dues Amount*
(Rs. in lakhs)
The Income-tax Income-tax 39,24.88
Act, 1961 including interest,
as applicable
2,86.79
The Central Sales Tax Sales-tax 30,47.89
Act, 1956 and including
Local Sales Tax Acts interest and penalty,
as applicable
Name of the statute Period to which the
amount Forum where the
dispute is
relates pending
The Income-tax
Act, 1961 Several demands
pertaining Appellate Authority - up to
to Assessment Years Commissioner''s level
2005-2006 to 2008-
2009 and 2011-12.
Assessment years Tribunal
1990-1991 and
1999-2000.
The Central Sales Tax
Act, 1956 and
Local Sales Tax Acts Several demands
pertaining Appellate Authority - up to
to the period
1983-1984 and Commissioner''s level
1988 to 2014.
Name of the statute Nature of dues Amount*
(Rs. in lakhs)
56,43.11
(include
Rs. 52,18.20
Lakhs not
deposited
due to a stay
order)
83.08
42.14
The Finance Service tax 1,29.20
Act, 1994
The Central Excise duty 25.60
Excise Act, 1944 including interest
and penalty,
as applicable
18,09.71
1,60.83
Name of the statute Period to which the
amount Forum where the
dispute is
relates pending
The Finance
Act, 1994 Several demands
pertaining Tribunal
to the period 1990-1991,
1998- 1999, 1999-2000 and
2001-2002 to
2008-2009.
Several demands
pertaining The High Court of
Judicature
to the period 1990-
1991, at Allahabad, Lucknow,
1999- 2000 and
2001-2002 and Kerala
Demand pertaining to
the Supreme Court
period 1993-1994 and
1994-1995
The Central
Excise Act, 1944 January 2001 to
December Customs, Excise &
Service Tax
2002 Appellate Tribunal
Several demands
pertaining Appellate Authority-
up to
to the periods March
1992 Commissioner''s level
to March 1994, July
1995 to January 1998.
Several Demands
Pertaining Customs, Excise &
Service Tax
to the Period October
1994 Appellate Tribunal
(CESTAT)
to January 1995,
September 1996 to
September 2002,
November 2003 to
December 2011,
September 2012 to
March 2013.
Demand pertaining to The High Court of
Judicature
1977-1980 and 1988-1991. at Bombay
*Net of amounts paid including under protest.
ix. The Company has no accumulated losses as at the end of the period
and it has not incurred any cash losses in the period ended on that
date or in the immediately preceding financial year.
x. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
xi. According to the information and explanations given to us and on an
overall examination of the balance sheet of the company, we report that
the no funds raised on short-term basis have been used for long-term
investment.
xii. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
period, nor have we been informed of any such case by the Management.
xiii. Matters specified in clauses (iii), (xii), (xiii), (xiv), (xv),
(xvi), (xviii), (xix) and (xx) of paragraph 4 of the Order do not apply
to the Company.
For Price Waterhouse & Co., Bangalore LLP
Firm Registration Number :007567S/S-200012
Chartered Accountants
Priyanshu Gundana
Partner
Mumbai, May 18, 2015 Membership Number: 109553
Dec 31, 2013
1. We have audited the accompanying financial statements of
GlaxoSmithKline Pharmaceuticals Limited (the "Company"), which
comprise the Balance Sheet as at December 31, 2013, the Statement of
Profit and Loss and Cash Flow Statement for the year then ended, and a
summary of significant accounting policies and other explanatory
information, which we have signed under reference to this report.
Management''s Responsibility for the Financial Statements
2. The Company''s Management is responsible for the preparation of
these financial statements that give a true and fair view of the
financial position, financial performance and cash flows of the Company
in accordance with the Accounting Standards notified under the
Companies Act, 1956 of India (the "Act"), read with the General
Circular 15/ 2013 dated September 13, 2013 of the Ministry of Corporate
Affairs in respect of Section 133 of the Companies Act, 2013. This
responsibility includes the design, implementation and maintenance of
internal control relevant to the preparation and presentation of the
financial statements that give a true and fair view and are free from
material misstatement, whether due to fraud or error.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing and other applicable authoritative
pronouncements issued by the Institute of Chartered Accountants of
India. Those Standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free from material misstatement.
4. An audit involves performing procedures to obtain audit evidence,
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditors'' judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditors consider internal control relevant to the
Company''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity''s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the
reasonableness of the accounting estimates made by Management, as well
as evaluating the overall presentation of the financial statements.
5. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion. Opinion
6. I n our opinion, and to the best of our information and according
to the explanations given to us, the accompanying financial statements
give the information required by the Act in the manner so required and
give a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at December 31, 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by Âthe Companies (Auditor''s Report) Order, 2003'', as
amended by Âthe Companies (Auditor''s Report) (Amendment) Order,
2004'', issued by the Central Government of India in terms of
sub-section (4A) of section 227 of the Act (hereinafter referred to as
the "Order"), and on the basis of such checks of the books and
records of the Company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
8. As required by section 227(3) of the Act, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purpose of our
audit;
(b) I n our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(d) I n our opinion, the Balance Sheet, Statement of Profit and Loss
and Cash Flow Statement dealt with by this report comply with the
Accounting Standards notified under the Act read with the General
Circular 15/ 2013 dated September 13, 2013 of the Ministry of Corporate
Affairs in respect of Section 133 of the Companies Act, 2013;
(e) On the basis of written representations received from the directors
as on December 31, 2013 and taken on record by the Board of Directors,
none of the directors is disqualified as on December 31, 2013 from
being appointed as a director in terms of clause (g) of sub-section (1)
of section 274 of the Act.
Referred to in paragraph 7 of the Independent Auditors'' Report of even
date to the members of GlaxoSmithKline Pharmaceuticals Limited on the
financial statements as of and for the year ended December 31, 2013
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets, other than the situation of certain plant and equipment,
furniture and office equipment, for which the situation recorded, is
the location of the Company''s different establishments.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items over a
period of three years which, in our opinion, is reasonable having
regard to the size of the Company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the Management during the year and no material
discrepancies have been noticed on such verification.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
ii. (a) The inventory excluding stocks with third parties has been
physically verified by the Management during the year. In respect of
inventory lying with third parties, these have substantially been
confirmed by them. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
iii. I n our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across, nor have been
informed of, any continuing failure to correct major weaknesses in the
aforesaid internal control system.
iv. According to the information and explanations given to us, there
have been no contracts or arrangements that need to be entered in the
register maintained under Section 301 of the Act.
v. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
thereunder.
vi. I n our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
vii. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that, prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
viii. (a) According to the information and explanations given to us
and the records of the Company examined by us, in our opinion,
the Company is generally regular in depositing undisputed statutory
dues in respect of service tax though there has been a slight delay in
a few cases, and is regular in depositing undisputed statutory dues,
including provident fund, investor education and protection fund,
employees'' state insurance, income tax, wealth tax, customs duty,
excise duty and other material statutory dues, as applicable, with the
appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth-tax
and customs duty which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, service tax,
and excise duty as at December 31, 2013 which have not been deposited
on account of a dispute, are as follows:
Name of the
statute Nature of dues Amount* Period to
which the
amount Forum where the
dispute is
(Rs. in
lakhs) relates pending
The Income
-tax Income-tax 12,38.27 Assessment
Years Appellate
Authority
- up to
Act, 1961 including
interest, 2007-2008
and
2008-2009 Commissioner''s
level
as appli-
cable
69,79.64 Several
demands
pertaining Tribunal
to Assess-
ment Years
1990-91,
1999-2000
and
2007-2008 to
2010-2011
The Central
Sales Tax Sales tax 29,66.80 Several
demands
pertaining Appellate
Authority
- up to
Act, 1956
and including to the
period
1983-1984
and Commissioner''s
level
Local Sales
Tax Acts interest
and
penalty, 1988 to 2010
as app-
licable
56,98.20 Several
demands Tribunal
(includes pertaining
to the period
Rs. 52,18.20 1990-1991,
1998-1999,
Lakhs not 1999-2000 and
2001-2002
deposited to
2005-2006
due to a Stay
Order)
87.06 Several
demands
pertaining The High Court
of Judicature
to the period
1990-1991, at Allahabad,
Lucknow, Punjab
1994-1996,
1999-2000
and and Haryana and
Kerala
2005-2006
42.14 Demand
pertaining
to the Supreme Court
period
1993-1994 and
1994-1995
The Finance Service tax 1,29.20 January 2001
to December Customs,Excise
& Service Tax
Act, 1994 2002 Appellate
Tribunal
The Central Excise duty 25.60 Several
demands
pertaining Appellate
Authority -
up to
Excise
Act, 1944 including
interest to the
periods
March 1992 Commissioner''s
level
and penalty, to March 1994,
July 1995 to
as applicable January 1998.
16,72.19 Several
Demands
Pertaining Customs,
Excise &
Service Tax
to the Period
October 1994 Appellate
Tribunal
(CESTAT)
to January
1995,
September
1996 to
September
2002,
November 2003
to December
2011.
1,60.83 Demand
pertaining to
1977- The High Court
of Judicature
1980 and
1988-1991. at Bombay
*Net of amounts paid including under protest.
ix. The Company has no accumulated losses as at the end of the
financial year and it has not incurred any cash losses in the financial
year ended on that date or in the immediately preceding financial year.
x. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
xi. According to the information and explanations given to us and on
an overall examination of the balance sheet of the company, we report
that the no funds raised on short-term basis have been used for
long-term investment.
xii. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the Management.
xiii. Matters specified in clauses (iii) (b), (c) and (d)/(f) and (g),
(xii), (xiii), (xiv), (xv), (xvi), (xviii), (xix) and (xx) of paragraph
4 of the CARO, 2003 do not apply to the Company.
For Price Waterhouse & Co., Bangalore
Firm Registration Number : 007567S
Chartered Accountants
Asha Ramanathan
Partner
Mumbai, 18th February, 2014 Membership Number: 202660
Dec 31, 2012
1. We have audited the attached Balance Sheet of GlaxoSmithKline
Pharmaceuticals Limited (the "Company") as at 31st December, 2012,
and the related Statement of Profit and Loss and Cash Flow Statement
for the year ended on that date annexed thereto, which we have signed
under reference to this report. These financial statements are the
responsibility of the Company''s Management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by Management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor''s Report) Order, 2003, as
amended by the Companies (Auditor''s Report) (Amendment) Order, 2004
(together the "Order"), issued by the Central Government of India
in terms of sub-section (4A) of Section 227 of ÂThe Companies Act,
1956'' of India (the ÂAct'') and on the basis of such checks of the
books and records of the Company as we considered appropriate and
according to the information and explanations given to us, we give in
the Annexure a statement on the matters specified in paragraphs 4 and 5
of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which, to the
best of our knowledge and belief, were necessary for the purposes of
our audit;
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as appears from our examination of
those books;
(c) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(d) In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of Section 211 of
the Act;
(e) On the basis of written representations received from the
directors, as on 31st December, 2012 and taken on record by the Board
of Directors, none of the directors is disqualified as on 31st
December, 2012 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give, in the prescribed
manner, the information required by the Act, and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st December, 2012;
(ii) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure To Auditors'' Report
[Referred to in paragraph 3 of the Auditors'' Report of even date to
the members of GlaxoSmithKline Pharmaceuticals Limited on the financial
statements for the year ended 31st December, 2012]
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation of fixed
assets, other than the situation of certain plant and equipment,
furniture and office equipment, for which the situation recorded, is
the location of the Company''s different establishments.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to cover all the items over a
period of three years which, in our opinion, is reasonable having
regard to the size of the Company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the Management during the year and no material
discrepancies have been noticed on such verification.
(c) In our opinion, and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
off by the Company during the year.
2. (a) The inventory excluding materials in transit has been
physically verified by the Management during the year. Further a major
portion of inventory lying with third parties has been physically
verified by the Management during the year. In our opinion, the
frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. In our
opinion, the discrepancies noticed on physical verification of
inventory as compared to book records were not material.
3. (a) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Therefore, the provisions of clauses
4(iii)(b),(c) and (d) of the said Order are not applicable to the
Company.
(b) The Company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Therefore, the provisions of clauses
4(iii)(f) and (g) of the said Order are not applicable to the Company.
4. In our opinion, and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the Company, and according to the information and
explanations given to us, we have neither come across, nor have been
informed of, any continuing failure to correct major weaknesses in the
aforesaid internal control system.
5. According to the information and explanations given to us, there
have been no contracts or arrangements that need to be entered in the
register maintained under Section 301 of the Act.
6. The Company has not accepted any deposits from the public within
the meaning of Sections 58A and 58AA of the Act and the rules framed
thereunder.
7. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
8. We have broadly reviewed the books of account maintained by the
Company in respect of products where, pursuant to the rules made by the
Central Government of India, the maintenance of cost records has been
prescribed under clause (d) of sub-section (1) of Section 209 of the
Act, and are of the opinion that, prima facie, the prescribed accounts
and records have been made and maintained. We have not, however, made a
detailed examination of the records with a view to determine whether
they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the Company examined by us, in our opinion, the Company
is generally regular in depositing undisputed statutory dues in respect
of income tax though there has been a slight delay in a few cases, and
is regular in depositing undisputed statutory dues, including provident
fund, investor education and protection fund, employees'' state
insurance, wealth tax, sales tax, service tax, customs duty, excise
duty and other material statutory dues, as applicable, with the
appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, there are no dues of wealth-tax
and customs duty which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, service tax
and excise duty as at 31st December, 2012 which have not been deposited
on account of a dispute, are as follows:
Name of the statute Nature of dues Amount*
Rs. in lakhs
The Income-tax Income-tax 12,38.27
Act, 1961 including interest,
as applicable
2,86.79
The Central Sales Tax Sales tax 17,70.63
Act, 1956 and including
Local Sales Tax Acts interest and penalty,
as applicable
Name of the Statute Period to which
the amount Forum where the dispute is
relates pending
The Income-tax Act,1961 Assessment Years Appellate Authority - up to
2007-2008 and
2008-2009 Commissioner''s level
Assessment Year Tribunal
1990-1991 and
1999-2000
The Central Sales Tax
Act, 1956 and Local
Sales Tax Acts Several demands Appellate Authority
pertaining to the - up to
period 1983-1984 Commissioner''s level
and 1988 to 2010
Name of the statute Nature of dues Amount*
Rs. in lakhs
3,16.51
92.06
The Finance Service tax 1,29.20
Act, 1994
The Central Excise duty 2,63.82
Excise Act, 1944 including interest
and penalty, as applicable
2,89.17
30.12
Name of the Statute Period to which
the amount Forum where the dispute is
relates pending
Several demands Tribunal
pertaining to the
period 1990-1991,
1998-1999,
1999-2000 and
2001-2002 to
2005-2006
Several demands
pertaining The High Court of
Judicature
to the period
1990-1991, at Allahabad, Lucknow,
1994-1996,
1999-2000 and Punjab and Haryana
2001-2002 and Kerala
The Finance Act, 1994 January 2001 to Customs, Excise and
December 2002 Service Tax Appellate
Tribunal (CESTAT)
The Central Excise
Act, 1944 Several demands Appellate Authority
pertaining to the
period - up to
March 1992 to
November Commissioner''s level
1998, July 2007 to
November 2007
and January 2011 to
December 2011
Several demands
pertaining Customs, Excise and
Service
to the period
October 1994 Tax Appellate Tribunal
to January 1995,
September (CESTAT)
1996 to September
2002 and November
2003 to January
2007
1977 to 1980 The High Court of
Judicature at Bombay
*Net of amounts paid including under protest.
10. The Company has no accumulated losses as at the end of the
financial year and it has not incurred any cash losses in the financial
year ended on that date or in the immediately preceding financial year.
11. According to the records of the Company examined by us and the
information and explanation given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders as at the balance sheet date.
12. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Therefore, the provisions of clause 4(xii) of the Order are not
applicable to the Company.
13. As the provisions of any special statute applicable to chit fund /
nidhi/ mutual benefit fund / societies are not applicable to the
Company, the provisions of clause 4(xiii) of the Order are not
applicable to the Company.
14. In our opinion, the Company is not dealing in or trading in
shares, securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable to the
Company.
15. In our opinion, and according to the information and explanations
given to us, the Company has not given any guarantee for loans taken by
others from banks or financial institutions during the year.
Accordingly, the provisions of clause 4(xv) of the Order are not
applicable to the Company.
16. The Company has not raised any term loans. Accordingly, the
provisions of Clause 4(xvi) of the Order are not applicable to the
Company.
17. According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the no funds raised on short-term basis have been used for
long-term investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year. Accordingly, the provisions of clause
4(xviii) of the Order are not applicable to the Company.
19. The Company has not issued any debentures during the year and does
not have any debentures outstanding as at the beginning of the year and
at the year end. Accordingly, the provisions of clause 4(xix) of the
Order are not applicable to the Company.
20. The Company has not raised any money by public issues during the
year. Accordingly, the provisions of clause 4(xx) of the Order are not
applicable to the Company.
21. During the course of our examination of the books and records of
the Company, carried out in accordance with the generally accepted
auditing practices in India, and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the Company, noticed or reported during the
year, nor have we been informed of any such case by the Management.
For Price Waterhouse & Co., Bangalore
Firm Registration Number: 007567S
Chartered Accountants
Asha Ramanathan
Partner
Mumbai, 19th February, 2013 Membership Number: 202660
Dec 31, 2010
1. We have audited the attached Balance Sheet of GlaxoSmithKline
Pharmaceuticals Limited (the company), as at 31st December, 2010, and
the related Profit and Loss Account and Cash Flow Statement for the
year ended on that date annexed thereto, which we have signed under
reference to this report. These financial statements are the
responsibility of the companys management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(together the Order) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956 of
India (the Act) and on the basis of such checks of the books and
records of the company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(b) In our opinion, proper books of account as required by law have
been kept by the company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the
directors, as on 31st December, 2010 and taken on record by the Board
of Directors, none of the directors is disqualified as on 31st
December, 2010 from being appointed as a director in terms of clause
(g) of sub-section (1) of Section 274 of the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give in the prescribed
manner the information required by the Act and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
company as at 31st December, 2010;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure To Auditors Report
[Referred to in paragraph 3 of the Auditors Report of even date to the
members of GlaxoSmithKline Pharmaceuticals Limited on the financial
statements for the year ended 31st December, 2010]
1. (a) The company is maintaining proper records showing full
particulars including quantitative details and situation of
fixed assets, other than the situation of furniture and office
equipment, for which the situation recorded is the location of the
companys different establishments.
(b) The fixed assets are physically verified by the management
according to a phased programme designed to cover all the items over a
period of three years which, in our opinion, is reasonable having
regard to the size of the company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the management during the year and no material
discrepancies between the book records and the physical inventory have
been noticed.
(c) In our opinion and according to the information and explanations
given to us, a substantial part of fixed assets has not been disposed
of by the company during the year.
2. (a) The inventory, excluding materials in transit, has been
physically verified by the management during the year.
Further, a major portion of inventory lying with third parties has been
physically verified by the management during the year. In our opinion,
the frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the company is maintaining proper records of inventory. In our
opinion, the discrepancies noticed on physical verification of
inventory as compared to book records were not material.
3. (a) The company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the
register maintained under Section 301 of the Act. Accordingly, clauses
(iii)(b) to (iii)(d) of paragraph 4 of the Order are not applicable to
the company for the current year.
(b) The company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, clauses (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable to the company
for the current year.
4. In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books and
records of the company and according to the information and
explanations given to us, we have neither come across nor have we been
informed of any instance of major weaknesses in the aforesaid internal
control system.
5. In our opinion and according to the information and explanations
given to us, there are no contracts or arrangements referred to in
Section 301 of the Act during the year that need to be entered in the
register maintained under that Section. Accordingly, clause (v)(b) of
paragraph 4 of the Order is not applicable to the company for the
current year.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the provisions of Sections
58A, 58AA or any other relevant provisions of the Act and the Companies
(Acceptance of Deposits) Rules, 1975 with regard to the deposits
accepted from the public. According to the information and explanations
given to us, no order has been passed by the Company Law Board or
National Company Law Tribunal or Reserve Bank of India or any Court or
any other Tribunal on the company in respect of the aforesaid deposits.
7. In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
company in respect of the products where, pursuant to the Rules made by
the Central Government of India, the maintenance of cost records has
been prescribed under clause (d) of sub-section (1) of Section 209 of
the Act and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. We have not,
however, made a detailed examination of the records with a view to
determine whether they are accurate or complete.
9. (a) According to the information and explanations given to us and
the records of the company examined by us, in our opinion, the company
is generally regular in depositing undisputed statutory dues including
provident fund, investor education and protection fund, employees
state insurance, income-tax, sales-tax, wealth tax, service tax,
customs duty, excise duty, cess and other material statutory dues as
applicable with the appropriate authorities in India.
(b) According to the information and explanations given to us and the
records of the company examined by us, there are no dues of wealth tax,
customs duty and cess which have not been deposited on account of any
dispute. The particulars of dues of income-tax, sales tax, service tax
and excise duty as at 31st December, 2010 which have not been deposited
on account of a dispute, are as follows -
Name of the statute Nature of dues Amount*
Rs. in lakhs
The Income-tax Income-tax 19,93.26
Act, 1961 including interest,
as applicable
The Centra! Sales Sales tax 9,46.33
Tax Act, 1956 and including
Local Sales Tax interest and
Acts penalty, as
applicable
9,71.40
The Finance Service tax 2,55.45
Act, 1994
The Central Excise duty 1,10.14
Excise Act, 1944 including interest
and penalty, as
applicable
2,89.17
30.12
Name of the Period to which the Forum where the
statue amount relates dispute is pending
The Income-tax
Act, 1961 #Assessment Years Appellate Authority -
2006-2007 and up to Commissioners
2007-2008 level
The Central Sales
Tax Act, 1956 and
Local Sales Tax
Acts Several demands Appellate Authority-
pertaining to the up to Commissioners
period 1983-1984 level
to 2009-2010
Several demands Tribunal
pertaining to the
period 1990-1991
to 2005-2006
The Finance
Act, 1994 January 2001 to Tribunal
December 2002
and May 2006 to
January 2007
The Central
Excise Act, 1944 Several demands Appellate Authority -
pertaining to the up to Commissioners
period March 1992 to level
November 2007
Several demands Tribunal
pertaining to the
period October 1994
to January 2007
1977 to 1980 The High Court of
Judicature at Bombay
* Net of amounts paid including under protest
# Out of total dues of Rs. 19,93.26 lakhs, an amount of Rs. 5,70.00
lakhs has been deposited subsequent to the year end.
10. The company has no accumulated losses as at 31st December, 2010
and has not incurred any cash losses in the financial year ended on
that date or in the immediately preceding financial year.
11. According to the records of the company examined by us and the
information and explanations given to us, the company has not defaulted
in repayment of dues to any financial institution or bank or debenture
holders.
12. The company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit
fund/nidhi/mutual benefit fund/societies are not applicable to the
company.
14. In our opinion and according to the information and explanations
given to us, the company is not a dealer or trader in shares,
securities, debentures and other investments.
15. According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from
banks or financial institutions during the year.
16. In our opinion and according to the information and explanations
given to us, the company has not obtained any term loans that were not
applied for the purpose for which these were raised.
17. On the basis of an overall examination of the Balance Sheet of the
company, in our opinion and according to the information and
explanations given to us, there are no funds raised on short-term basis
which have been used for long- term investment.
18. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The company has not issued any debentures.
20. The company has not raised any money by public issues during the
year.
21. During the course of our examination of the books and records of
the company, carried out in accordance with the generally accepted
auditing practices in India and according to the information and
explanations given to us, we have neither come across any instance of
material fraud on or by the company, noticed or reported during the
year, nor have we been informed of such case by the management.
For Price Waterhouse & Co.
Firm Registration No. 007567S
Chartered Accountants
Himanshu Goradia
Partner
Mumbai, 14th February, 2011 Membership No. 45668
Dec 31, 2009
1. We have audited the attached Balance Sheet of GlaxoSmithKline
Pharmaceuticals Limited, as at 31st December, 2009, and the related
Profit and Loss Account for the year ended on that date annexed thereto
and the Cash Flow Statement for the year ended on that date, which we
have signed under reference to this report. These financial statements
are the responsibility of the companys management. Our responsibility
is to express an opinion on these financial statements based on our
audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 as
amended by the Companies (Auditors Report) (Amendment) Order, 2004
(together the Order) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of The Companies Act, 1956 of
India (the Act) and on the basis of such checks of the. books and
records of the company as we considered appropriate and according to
the information and explanations given to us, we give in the Annexure a
statement on the matters specified in paragraphs 4 and 5 of the Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;
(b) In our opinion, proper books of account as required by law have
been kept by the company so far as appears from our examination of
those books;
(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;
(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the Act;
(e) On the basis of written representations received from the Directors
of the company, as on 31st December, 2009, and taken on record by the
Board of Directors of the company, none of the Directors of the company
is disqualified as on 31st December, 2009 from being appointed as a
Director in terms of clause (g) of sub-section (1) of Section 274 of
the Act;
(f) In our opinion and to the best of our information and according to
the explanations given to us, the said financial statements together
with the notes thereon and attached thereto give in the prescribed
manner the information required by the Act and give a true and fair
view in conformity with the accounting principles generally accepted in
India:
(i) in the case of the Balance Sheet, of the state of affairs of the
company as at 31s* December, 2009;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure To Auditors Report
[Referred to in paragraph 3 of the Auditors Report of even date to the
members of GlaxoSmithKline Pharmaceuticals Limited on the financial
statements for the year ended 31st December, 2009]
1. (a) The company has maintained proper records showing full
particulars including quantitative details and situation of
fixed assets, other than the situation of furniture and office
equipment, for which the situation recorded is the location of the
companys different establishments.
(b) The fixed assets are physically verified by the management
according to a phased programme designed to cover all the items over a
period of three years which, in our opinion, is reasonable having
regard to the size of the company and the nature of its assets.
Pursuant to the programme, a portion of the fixed assets has been
physically verified by the management during the year and no material
discrepancies between the book records and the physical inventory have
been noticed.
(c) In our opinion, a substantial part of fixed assets has not been
disposed of by the company during the year.
2. (a) The inventory, excluding materials in transit, has been
physically verified by the management during the year.
Further, a major portion of inventory lying with third parties has been
physically verified by the management during the year. In our opinion,
the frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the management are reasonable and adequate in
relation to the size of the company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the company is maintaining proper records of inventory. In our
opinion, the discrepancies noticed on physical verification of
inventory as compared to the book records were not material and have
been properly dealt with in the books of account.
3. (a) The company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, clauses (iii)(b) to (iii)(d)
of paragraph 4 of the Order are not applicable to the company for the
current year.
(b) The company has not taken any loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Accordingly, clauses (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable to the company
for the current year.
4. In our opinion and according to the information and explanations
given to us, having regard to the explanation that certain items of
inventory and fixed assets purchased are of special nature for which
suitable alternative sources do not exist for obtaining comparative
quotations, there is an adequate internal control system commensurate
with the size of the company and the nature of its business for the
purchase of inventory and fixed assets and for the sale of goods and
services. Further, on the basis of our examination of the books of
account and according to the information and explanations given to us,
we have not come across nor have we been informed of any instance of
major weaknesses in the aforesaid internal control system.
5. In our opinion and according to the information and explanations
given to us, there are no contracts or arrangements referred to in
Section 301 of the Act during the year that need to be entered in the
register maintained under that Section. Accordingly, clause (v)(b) of
paragraph 4 of the Order is not applicable to the company for the
current year.
6. In our opinion, the company has complied with the provisions of
Sections 58A, 58AA or any other relevant provisions of the Act and the
Companies (Acceptance of Deposits) Rules, 1975 with regard to the
deposits accepted from the public which have matured and are remaining
unpaid as at 31st December, 2009. According to the information and
explanations given to us, no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India or any
Court or any other Tribunal on the company in respect of the aforesaid
deposits.
7. In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
8. We have broadly reviewed the books of account maintained by the
company, pursuant to the Rules made by the Central Government of India
for the maintenance of cost records, under clause (d) of sub-section
(1) of Section 209 of the Act and are of the opinion that prima facie,
the prescribed accounts and records have generally been maintained and
are under preparation. We have not, however, made a detailed
examination of the records with a view to determining whether they are
accurate or complete.
9. (a) According to the books of account and records as produced and
examined by us in accordance with the generally accepted auditing
practices in India, in our opinion, the company is generally regular in
depositing undisputed statutory dues in respect of provident fund,
investor education and protection fund, employees state insurance,
income-tax, sales tax, wealth tax, service tax, customs duty, excise
duty, cess and other material statutory dues as applicable with the
appropriate authorities in India.
(b) According to the books of account and records as produced and
examined by us in accordance with the generally accepted auditing
practices in India, there are no dues of income-tax, wealth tax,
customs duty and cess which have not been deposited on account of any
dispute. The particulars of dues of sales tax, service tax and excise
duty as at 31st December, 2009 which have not been deposited on account
of a dispute, are as follows -
Name of the
statute Nature of dues Amount* Period to which the
Rs, in lakhs amount relates
The Central Sales tax 13,54.05 Several demands
Sales Tax Act,including interest pertaining to the
1956 and
Local and penalty, as period 1983-1984
Sales Tax
Acts applicable to 2008-2009
9,28.46 Several demands
pertaining to the
period 1990-1991
to 2002-2003
The Finance
Act, Service tax 2,55.45 January 2001 to
1994 December 2002
and May 2006 to
January 2007
1,12.98 October 1998 to
December 2000
The Central Excise duty 1,10.14 Several demands
Excise
Act, 1944 including interest pertaining to the
and penalty, as period March 1992
applicable to November 2007
6,48.39 Several demands
pertaining to the
period July 1993 to
January 2007
30.12 1977 to 1980
Name of the statue Forum where the
dispute is pending
The Central
Sales Tax Act,
1956 and Local
Sales Tax Acts Appellate Authority -
up to Commissioners
level
Tribunal
The Finance Act,
1994 Tribunal
The High Court of
Judicature at Bombay
The Central
Excise Act, 1944 Appellate Authority -
up to Commissioners
level
Tribunal
The High Court of
Judicature at Bombay
*Net of amounts paid under protest or otherwise
10. The company has no accumulated losses as at 31st December, 2009
and has not incurred any cash losses in the financial year ended on
that date or in the immediately preceding financial year.
11. According to the books of account and records of the company,
there has been no default in repayment of dues to any financial
institution or bank or debenture holders during the year.
12. The company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
13. The provisions of any special statute applicable to chit
fund/nidhi/mutual benefit fund/societies are not applicable to the
company.
14. In our opinion and according to the information and explanations
given to us, the company is not a dealer or trader in shares,
securities, debentures and other investments.
15. The company has not given any guarantee for loans taken by others
from banks or financial institutions during the year.
16. In our opinion, the company has not obtained any term loans that
were not applied for the purpose for which these were raised.
17. On the basis of the information and explanations given to us and
on an overall examination of the Balance Sheet of the company, in our
opinion, there are no funds raised on a short-term basis which have
been used for long-term investment.
18. The company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under Section
301 of the Act during the year.
19. The company has not issued any debentures.
20. The company has not raised any money by public issue during the
year.
21. During the course of our examination of the books of account and
records of the company, carried out in accordance with the generally
accepted auditing practices in India, we have not come across any
instance of material fraud on or by the company, noticed or reported
during the year, nor have we been informed of such case by the
management.
For Price Waterhouse & Co.
Chartered Accountants
Himanshu Goradia
Partner
Mumbai, 15th February, 2010 Membership No. 45668