Mar 31, 2023
To The Members of Piramal Enterprises Limited
Report on the Audit of the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Piramal Enterprises Limited ("the Company"), which comprises of Standalone Balance Sheet as at March 31, 2023, the Standalone Statement of Profit and Loss (including Other Comprehensive Income), the Standalone Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the standalone financial statements").
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 ("the Act") 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 Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2023, its profit total other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit 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 Responsibilities 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. We have fulfilled the responsibilities described in the Auditor''s responsibilities for the audit of the Standalone Financial Statements section of our report, including in relation to these matters.
Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone financial statements.
Sr. No. Key Audit Matters |
Auditors Response |
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1 Expected Credit Loss allowance on financial assets and net loss on derecognition of financial instruments under amortised cost category. |
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Refer to accounting policies in Note 2 (iii) to the standalone financial statements; Impairment and net loss on derecognition of financial instruments under |
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amortised cost category - Notes 18, 25, 26 and 40.3 to the standalone financial statements. |
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Under Ind AS 109, Financial Instruments, allowance |
Principal audit procedures followed: |
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for loan losses are determined using expected credit loss (ECL) |
> |
Reviewed the Board approved loss allowance policy and verified the |
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estimation model. The estimation of ECL on financial instruments |
alignment of methodology adopted for computation of ECL that addresses |
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involves significant judgement and estimates. The key areas where |
the policies approved by the Board of Directors. |
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we |
identified greater levels of management judgement and therefore |
> |
Tested the design and operating effectiveness of the key controls over the |
increased levels of audit focus in the Company''s estimation of ECL are: |
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completeness and accuracy of data, inputs and assumptions into the ECL |
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> |
The application of ECL model requires several data inputs to |
Model. |
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calculate Probability of Default ("PDs"), Loss Given Default ("LGD") |
> |
Evaluated whether the methodology applied by the Company is compliant |
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and Exposure at Default (EAD). Inherently judgmental inputs / |
with the requirements of the relevant accounting standards, Reserve Bank |
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model used to estimate ECL which involves determination of PD, |
of India''s (''RBI'') master directions relating to Prudential norms on Income |
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LGD and EAD. |
Recognition, Asset Classification and Provisioning pertaining to Advances |
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> |
The PD and the LGD are the key drivers of estimation complexity in |
and confirmed that the calculations are performed in accordance with |
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the ECL and as a result are considered as a significant judgmental |
the approved methodology and ECL amounts has been approved by the |
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aspect of the Company''s modelling approach. |
management and the Audit committee. |
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> |
Estimating Management overlay for economic uncertainty, |
> |
Tested on sample basis key inputs, data and assumptions impacting ECL |
forward-looking information, and macro-economic factors |
calculations to assess the completeness, accuracy and relevance of data and |
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> |
Completeness and accuracy of the data from internal and external |
reasonableness of economic forecasts and model assumptions applied. |
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sources used in the Models. Qualitative and quantitative factors |
> |
Tested the arithmetical accuracy of the computation of ECL provision |
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used in staging the loan assets. |
performed by the Company in spreadsheets. |
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Considering the significance of ECL to the overall standalone financial |
> |
Assessed whether the disclosures on key judgements, assumptions and |
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statements and the degree of Management''s estimates and judgements |
quantitative data with respect to impairment loss allowance in standalone |
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involved in this matter that requires significant auditors'' attention. We |
financial statements are appropriate and sufficient. |
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have considered the expected credit loss allowance on financial assets |
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to be a key audit matter. |
Sr. No. |
Key Audit Matters |
Auditors Response |
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The disclosures regarding the Company''s application of Ind AS 109 are key to explaining the key judgements and material inputs to ECL and net loss on derecognition of financial instruments under amortised category. Further, disclosures to be provided as per RBI circulars with regards to non-performing assets and provisions will also be an area of focus, particularly as this will be the first year some of these disclosures will be presented and are related to an area of significant estimate. |
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2 |
Determination of fair value for the purpose of measurement of certain financial assets measured at fair value and for the purpose of impairment assessment of investments in subsidiary, joint venture or associate companies measured at cost and investment property: Refer to Accounting policies in Notes 2 (iv), 2 (vii) and 2 (xi) to the standalone financial statements; Investment measured at fair value, net gain on fair value changes and other operating income - Notes 6, 21 (iv) and 21 (v) to the standalone financial statements; Investment in subsidiary, joint venture and associate companies and provision thereon - Notes 6,28 and 43 to the standalone financial statements; Investment property - Note 34 to the standalone financial statements; Fair value disclosures - Note 38 to the standalone financial statements. |
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The Company''s investments in unquoted instruments (other than |
Principal audit procedures followed: |
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investment in subsidiaries, joint ventures and associates) are measured |
> |
Understood the process, evaluating the design and testing the operating |
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at fair value at each reporting date and these fair value measurements |
effectiveness of such controls in respect of valuation of investments by |
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significantly impact the Company''s financial performance. The |
management. |
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Company''s investments in subsidiaries, joint ventures and associates |
> |
Evaluated management''s controls over collation of relevant information |
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and investment property are measured at cost less provision for |
used for determining estimates for valuation and impairment testing of |
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impairment, if any. |
investments. |
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The valuation for the purpose of measurement and impairment |
> |
Tested appropriate implementation of policy of valuation and impairment testing by management. Reconciled the financial information mentioned in fair valuation and |
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assessment requires significant judgement because of quoted prices being unavailable and limited liquidity. |
> |
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impairment testing to underlying source details. |
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The disclosures regarding the Company''s fair value estimation are key to |
> |
Obtained independent valuation reports of unquoted investments. |
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explaining the key estimation and judgements including material inputs |
> |
Tested the reasonableness of management''s estimates considered in such |
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to the estimated valuation figures. |
> |
assessment. Assessed the competence, capabilities and objectivity of the experts used by management in the process of valuation models. |
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> |
Assessed the factual accuracy conclusion reached by the management and appropriateness of the disclosures made in the standalone financial statements in respect of investments. |
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3 |
Information Technology (IT) systems and controls impacting financial reporting. |
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The IT environment of the Company is complex and involves a |
Principal audit procedures followed: |
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number of independent and interdependent IT systems used in the |
> |
In assessing the controls over the IT systems of the component, involved |
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operations of the Company for processing and recording a large volume |
our technology specialists to obtain an understanding of IT environment, IT |
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of transactions. As a result, there is a high degree of reliance and dependency on such IT systems for the financial reporting process of the |
> |
infrastructure and IT systems. |
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Company. |
Evaluated and tested relevant IT general controls and IT application controls of the âin-scope" IT systems identified as relevant for our audit of the |
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Appropriate IT general controls and IT application controls are required |
Company''s standalone financial statements and financial reporting process |
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to ensure that such IT systems are able to process the data as required, |
of the Company. |
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completely, accurately, and consistently for reliable financial reporting. |
> |
On such âin-scope" IT systems, tested key IT general controls as follows: |
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We have identified certain key IT systems (âin-scope" IT systems) |
⢠Program change management, which includes that program changes |
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which have an impact on the financial reporting process and the |
are moved to production environment as per defined procedures. |
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related control testing as a key audit matter because of the high |
⢠User access management, which includes user access provisioning, |
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level of automation, significant number of systems being used by the |
de-provisioning, access review, password management, sensitive |
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Company for processing financial transactions, the complexity of the IT |
access rights and segregation of duties to ensure that privilege access |
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architecture and its impact. |
to applications, operating system and databases in the production environment were granted only to authorized personnel. |
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⢠Program development, which comprises IT operations and system |
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development life cycle for relevant in-scope applications, operating systems, and databases, which are relied upon for financial reporting. |
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> |
Other areas that were assessed under the IT control environment included backup management, business continuity, disaster recovery, incident management, interface, batch processing and monitoring. |
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> |
Evaluated the design and tested the operating effectiveness of key IT application controls within key business processes, which included testing automated calculations, automated accounting procedures, system interfaces, system reconciliation controls and key system generated reports. |
INFORMATION OTHER THAN THE STANDALONE FINANCIAL STATEMENTS AND AUDITOR''S REPORT THEREON
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Board Report including annexures to the Board report but does not include the standalone financial statement 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 accounting principles generally accepted in India, including the accounting Standards specified 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 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, the 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.
The Board of Directors is also responsible for overseeing the Company''s financial reporting process.
AUDITOR''S RESPONSIBILITIES 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 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 with reference to the 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 entity 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 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 auditors'' 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.
(i) The standalone financial statements of the Company for the year ended March 31, 2022 included in these standalone financial statements, were audited by the predecessor auditor. The report of the predecessor auditor of this comparative information dated May 26, 2022 expressed an unmodified opinion on those statements.
(ii) The comparative Standalone Financial Statements, as mentioned above in para (i) above, of the Company for year ended 31 March, 2022 have been restated pursuant to:
(a) the Company on receiving the Certificate of Registration from the Reserve Bank of India, to carry on the business of non-banking financial company. The Company has prepared and presented its standalone financial statements as per the format prescribed in Division III of Schedule III to Companies Act, 2013, (Refer note 1B to the standalone financial statements and)
(b) the National Company Law Tribunal approval of Composite Scheme of Arrangement for demerger of Pharma undertaking and merger of PHL Fininvest Private Limited, a wholly owned subsidiary, into the Company, effective from April 1, 2022 (Refer Note 42 to the standalone financial statements.)
Our opinion is not modified in respect of these matters.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. Pursuant to the Companies (Auditor''s Report) Order, 2020 ("the Order"), issued by the Central Government of India in terms of Sub-Section (11) of Section 143 of 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" a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2. 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 & 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 Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended.
(e) On the basis of the written representation received from the directors as on March 31, 2023 taken on records by the Board of Directors, none of the directors are disqualified as on March 31, 2023 from being appointed as a Directors in terms of Section 164(2) of the Act.
(f) 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 Annexure "B".
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.
(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 explanations given to us, the Company has complied with the provisions of Section 197 read with Schedule V 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. (Refer note 32 (a) to 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 their knowledge and belief, no funds (which are material either individually or in the aggregate) 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 or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(b) The management has represented, that to the best of their knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company
from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend to or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representation under Sub Clause (i) and (ii) of Rule 11(e) of The Companies (Audit and Auditors) Rules, 2014, as provided under (a) and (b) above, contains any material misstatement. [Refer note 45 (ix) and 45 (x) to the standalone financial statements.]
v. The dividend declared or paid during the year by the Company is in compliance with the Section 123 of the Act.
vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company with effect from April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.
Mar 31, 2022
To The Members of Piramal Enterprises Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of Piramal Enterprises Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2022, 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 ("the Act") 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, ("Ind AS") 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 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 Matter |
Auditor''s Response |
1. |
Impairment loss allowance on loans and investment pertaining to finance business. Charge to the statement of profit and loss of CNIL Provision: C246.08 Crores as at March 31, 2022 |
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[Refer to Note 2(a)(vii), 2(b)(iii) and 47(f) to the standalone financial statements] |
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The Company as part of its financial services segment offers long-term and |
We performed the following key audit procedures: |
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short-term wholesale lending primarily to the real estate and infrastructure |
We held discussions with the Management and evaluated management''s assessment |
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sector. Loans and investment portfolio in the finance business are measured |
of the ECL provision at each stage including assessment of COVID-19 impact, to |
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at amortised cost less impairment allowance for losses. The Company applies |
determine if the provision was reasonable considering the Company''s portfolio, risk |
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the expected credit loss (ECL) model for recognising impairment loss. |
profile, credit risk management practices and the macroeconomic environment. |
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The Company''s assessment of expected credit loss involves use of judgements |
We evaluated the design of internal controls relating to the computation of ECL |
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and estimates, such as determination of probability of default (PD), |
provision, the key assumptions (i.e. staging, EAD, PD and LGD rates) and other inputs |
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determination of the staging, loss given default (LGD), exposure at default (EAD), estimating Management overlay for economic uncertainty expected |
used therein, including macro-economic factors. |
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to result from COVID 19 pandemic, forward-looking information, and macro- |
We selected a sample of loan contracts and tested the operating effectiveness |
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economic factors, in computing the ECL on loans and investments. |
of controls over computation of ECL provision, the key assumptions and inputs used therein, through inspection of evidence of performance of these controls or |
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We identified impairment of loan and investment portfolio in finance business as a key audit matter because the Company exercises significant judgement |
independently re-performing the control. |
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in calculating the expected credit losses. |
Through a sample of loan contracts, we performed substantive procedures, to evaluate adequacy of ECL provisioning made. |
Information Other than the Financial Statements and Auditor''s 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 Report, Corporate Governance, 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
As part of an audit in accordance with SAs, we exercise professional judgement and maintain professional scepticism 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;
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.
Management''s 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 judgements 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.
Auditor''s 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.
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, 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 "Annexure A". 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 read with Schedule V 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 made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
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 notes to the accounts no funds (which are material either individually or in the aggregate) 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 ("Intermediaries"), 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 ("Ultimate Beneficiaries") 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 notes to accounts, no funds (which are
material either individually or in the aggregate) have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), 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 ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(c) Based on the audit procedures that has been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. (a) As stated in note 17 to the financial statements, 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.
(b) No interim dividend has been declared and paid by the Company during the year.
(c) As stated in note 17 to the 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 amount of dividend proposed is in accordance with Section 123 of the Act, as applicable.
2. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B" 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
Place: Mumbai Partner
Date: May 26, 2022 (Membership No. 046930)
UDIN:22046930AJ RQGZ6242
Mar 31, 2021
To The Members of Piramal Enterprises Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of Piramal Enterprises Limited ("the Company"), 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 ("the Act") 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, ("Ind AS") 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.
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 Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We
Sr. No. |
Key Audit Matter |
Auditor''s Response |
1. |
Impairment loss allowance on loans and investment pertaining to finance business. Charge to the statement of profit and loss of (C162.84) Crores. Provision: C246.08 Crores as at March 31, 2021 |
|
[Refer to Note 2(a)(vii), 2(b)(iii) and 47(f) to the standalone financial statements] |
||
The Company as part of its financial services segment offers long-term and |
We performed the following key audit procedures: |
|
short-term wholesale lending primarily to the real estate and infrastructure |
a) We held discussions with the Management and evaluated management''s |
|
sector. Loans and investment portfolio in the finance business are measured |
assessment of the ECL provision at each stage including assessment of |
|
at amortised cost less impairment allowance for losses. The Company |
COVID-19 impact, to determine if the provision was reasonable considering |
|
applies the expected credit loss (ECL) model for recognising impairment loss. |
the Company''s portfolio, risk profile, credit risk management practices and the |
|
The Company''s assessment of expected credit loss involves use of |
macroeconomic environment. |
|
judgements and estimates, such as determination of probability of default |
b) We evaluated the design of internal controls relating to the computation of ECL |
|
(PD), determination of the staging, loss given default (LGD), exposure at |
provision, the key assumptions (i.e. staging, EAD, PD and LGD rates) and other |
|
default (EAD), estimating Management overlay for economic uncertainty |
inputs used therein, including macro-economic factors |
|
expected to result from COVID-19 pandemic, forward-looking information |
c) We selected a sample of loan contracts and tested the operating effectiveness |
|
and macro-economic factors, in computing the ECL on loans and investments. |
of controls over computation of ECL provision, the key assumptions and inputs used therein, through inspection of evidence of performance of these controls |
|
We identified impairment of loan and investment portfolio in finance |
or independently re-performing the control. |
|
business as a key audit matter, because the Company exercises significant |
d) Through a sample of loan contracts, we performed substantive procedures, to |
|
judgement in calculating the expected credit losses. |
evaluate adequacy of ECL provisioning made. |
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.
As more fully described in note 2(b)(i) to the standalone financial statements to assess the recoverability of certain assets, the Company has considered internal and external information in respect of the current and estimated future global including Indian economic indicators consequent to the global health pandemic. The actual impact of the pandemic may be different from that considered in assessing the recoverability of these assets.
Our opinion is not modified in respect of this matter.
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.
2 Recoverable value assessment of Investment Property (Land Development Rights) |
- Carrying Value of C1,297.63 Crores and Recoverable Value of C1,579 Crores. |
[Refer to Note 2a(v), 2b (iv) and Note 45 to the standalone financial statements] |
|
The Company has acquired development rights for certain land parcels which We performed the following key audit procedures: |
|
are classified as Investment Property and held for capital appreciation. a) |
Obtained understanding of management''s process and evaluated design and |
The management while determining the recoverable value has exercised significant judgements and estimates relating to expected revenue, related cost and risk-adjusted discount rates. b) |
tested operating effectiveness of controls for determination of recoverable value of the investment property. Performed physical verification of the underlying Investment Property and corroborated the saleable area with the Letter of intent and independent |
Sr. No Key Audit Matter |
Auditor''s Response |
We have identified recoverable value assessment of investment property as a key audit matter for the current year audit as the Company exercises significant judgement in estimating the recoverable value of investment property. |
c) Obtained the recoverable value working prepared by the management basis the inputs from an independent valuation expert for the project to evaluate the appropriateness of the underlying data, methodology applied and assumption used by the management for determining the recoverable value of investment property. We have also involved internal valuation specialist, to evaluate the appropriateness of the key assumptions used by the management for determining the recoverable value of investment property. |
⢠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 Report, Corporate Governance, 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.
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 judgements 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.
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.
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 "Annexure A". 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, and having regard to independent legal opinions obtained by the Company, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of Section 197 read with Schedule V to 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 made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts;
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 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B" a statement on the matters specified in paragraphs 3 and 4 of the Order.
For Deloitte Haskins & Sells LLP
Chartered Accountants (Firm Registration No. U7366W/W-100018)|
Rupen K. Bhatt
Partner
(Membership No.046930) Place: Mumbai, June 1, 2021 (UDIN: 21046930AAAACS1671)
Mar 31, 2019
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the accompanying standalone financial statements of Piramal Enterprises Limited (âthe Companyâ), which comprise of 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 (hereinafter referred to as âthe standalone financial statementsâ)
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 loss, total comprehensive loss, 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 Responsibilities 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 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 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. 1. |
Key Audit Matter Auditorâs Response Impairment of loan and investment portfolio in finance business - Carrying value of loans and investment: Rs.4,579.74 Crores, Expected Credit Loss provisioning : Rs.139.03 Crores [Refer to Note 2(a)(vii), 2b and 47(f) to the standalone financial statements] |
|
The Company as part of its financial services segment offers long |
Principal audit procedures: |
|
term and short term wholesale lending to various sectors. Loans and |
a) Assessed the reasonableness of the ECL model based on the parameters |
|
investment portfolio in the finance business are measured at amortised |
developed by the Company for determining impairment loss. |
|
cost less impairment allowance for losses. The Company applies the |
b) Evaluated the design of internal controls relating to the computation of ECL |
|
expected credit loss model for recognising impairment loss. |
provision and the key assumptions (i.e. PD and LGD) rates and inputs used |
|
The Companyâs assessment of expected credit loss involves use of |
therein. |
|
judgements and estimates relating to probability of default (PD) and loss |
c) Selected a sample of loan contracts and tested the operating effectiveness |
|
given default (LGD) rates used in computing the expected credit losses |
of controls over computation of ECL provision and the key assumptions (i.e. |
|
(ECL) on loans and investments. |
PD and LGD rates) and inputs used therein through inspection of evidence of performance of these controls or independently re-performing the control. d) Through a sample of loan contracts, determined adequacy of ECL provisioning made. |
|
2. |
Adoption of New Accounting Standard Ind AS 115: Revenue from contracts with customers relating to the pharmaceutical manufacturing and services [Refer to Note 2a(xii) and 27 to the standalone financial statements] |
|
The Company manufactures and sells a number of products and |
Principal audit procedures: |
|
provides numerous services to its customers. The Company has |
a) Obtained an understanding of the various revenue streams and nature of sales |
|
adopted the new accounting standard Ind AS 115 as at April 1, 2018 |
contracts entered into by the Company. |
|
and accordingly has reviewed its sales contracts for determining the |
b) Evaluated the design of internal controls relating to identification of performance |
|
principles for recognizing revenue in accordance with the new standard. |
obligations and determining timing of revenue recognition. |
|
Some of the sales contracts contain various performance obligations |
c) Selected a sample of contracts and through inspection of evidence of |
|
and management exercises judgement to determine timing of revenue |
performance of these controls, tested the operating effectiveness of the internal |
|
recognition, i.e., over time or a point in time. |
controls relating to the identification of performance obligations and timing of revenue recognition. d) Selected a sample of contracts and reassessed contractual terms to determine adherence to the requirements of the new accounting standard. |
Information Other than the Standalone Financial Statements and Auditorâs Report Thereon
- The Companyâs Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis, Boardâs Report including Annexures to Boardâs Report, Business Responsibility Report, Corporate Governance, but does not include the consolidated financial statements, 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 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 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.
Those 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 relevant 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 made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts
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 to the members of Piramal Enterprises Limited 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 Piramal Enterprises Limited (âthe Companyâ) as of March 31, 2019 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
The Board of Directors of the Company 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, 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 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 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.
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 to the Members of Piramal Enterprises Limited)
(i) In respect of its property, plant and equipment:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.
(b) The Company has a program of verification of fixed assets to cover all the items in a phased manner 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 program, certain fixed assets were physically verified by the Management during the year. According to the information and explanation given to us, no material discrepancies were noticed on physical verification of fixed assets.
(c) 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 / conveyance deed / confirmation from custodians/ Court Orders approving scheme of arrangements/amalgamations provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings, which are freehold are held in the name of the Company as at the balance sheet date .
(ii) As explained to us, the inventories excluding stocks with third parties were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification. In respect of inventory lying with third parties, confirmations were obtained by management for substantial portions of stocks held by them at the year-end.
(iii) According to the information and explanations given to us, the Company has not granted any secured loans to companies, firms, or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013. In respect of unsecured loans to companies covered in the Register maintained under Section 189 of the Companies Act,2013:
(a) The terms and conditions of the grant of such loans are, in our opinion, prima facie, not prejudicial to the Companyâs interest
(b) The schedule of repayment of principal and payment of interest has been stipulated and repayments or receipts of principal amounts and interest have been regular as per stipulations.
(c) There is no overdue amount remaining outstanding as at the balance sheet date .
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year in terms of provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013.
(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 with the appropriate authorities.
(b) There were no undisputed amounts payable in respect of Provident Fund, Employeesâ State Insurance, Income-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 and Excise Duty which have not been deposited as at March 31, 2019 on account of disputes are given below:
Name of Statute |
Nature of Dues |
Forum where Dispute is Pending |
Period to which the Amount Relates |
Amount (Rs. in Crores) |
Appellate Tribunal |
A.Y 2002-03 to 2007-08 and A.Y 2009-10 to 2014-15 |
316.82 |
||
Income Tax Act 19611 |
Income Tax |
Appellate Authority upto Commissionerâs level |
A.Y. 2005-06, A.Y 2010-11 and A.Y 2012-13 |
2.05 |
Central Excise Laws2 |
Excise Duty & Service Tax including interest and penalty, as applicable. |
High Court |
2008-09 , 2009-10 |
7.66 |
CESTAT |
1996-97 to 2000-01, 2004-05 to 2015-16 |
14.65 |
||
Appellate Authority upto |
1989-90, 1995-96, 1998-99 to 2000-01, 2003-04 |
4.68 |
||
Commissionerâs level |
to 2006-07, 2008-09 to 2017-18 |
|||
Sales Tax Laws3 |
Sales Tax |
Tribunal |
1990-91, 1995-96, 1997-98 to 2007-08, 2009-10, 2010-11 |
3.21 |
Appellate Authority upto |
1998-99 to 2016-17, 2018-19 |
7.50 |
||
Commissionerâs level |
||||
Custom Laws4 |
Custom Duty |
CESTAT |
2009-2010 to 2011-2012 |
1.56 |
1 Net of Rs.305.92 Crores paid under protest; 2 Net of Rs.4.84 Crores paid under protest; 3 Net of Rs.5.40 Crores paid under protest; 4 Net of Rs.0 . 11 Crores paid under protest .
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government and dues to debenture holders.
(ix) In our opinion and according to the information and explanations given to us, money raised by way of rights issue of equity shares in the previous year that were pending utilisation, (including money received during the year from the CCD holders who subscribed for rights issue) and the term loans have been applied by the Company for the purposes for which they were raised .
(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 requisite approval mandated by the provision 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 3 (xii) of the Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 177 and 188 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 Companies (Auditorâs Report) Order, 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 persons connected with them and hence provisions of Section 192 of the Companies Act, 2013 are not applicable.
(xvi) The Company is not required to be registered under Section 45-I of the Reserve Bank of India Act, 1934.
For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm Registration No. 117366W/W-100018)
Rupen K. Bhatt
Partner
Mumbai, April 26, 2019 (Membership No. 046930)
Mar 31, 2018
Report on the Standalone Financial Statements
We have audited the accompanying standalone financial statements of Piramal Enterprises 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 Statement of Changes in Equity and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Managementâs Responsibility for the Standalone 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 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 judgements 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.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone 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 thereunder and the Order issued under section 143(11) of the Act.
We conducted our audit of the standalone 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 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 financial statements. The procedures selected depend on the auditorâs judgement including the assessment of the risks of material misstatement of the standalone 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 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 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 financial statements.
Opinion
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 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, 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 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 March 31, 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 financial statements;
ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts. The Company did not have any 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, except for delays upto 56 days in respect of transfer of 534,012 equity shares, in terms of Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 as amended from time to time, 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 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 to the Members of Piramal Enterprises Limited)
(i) In respect of its property, plant and equipment:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.
(b) The Company has a program of verification of fixed assets to cover all the items in a phased manner 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 program, certain fixed assets were physically verified by the Management during the year. According to the information and explanation given to us, no material discrepancies were noticed on physical verification of fixed assets.
(c) 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/conveyance deed/confirmation from custodians/Court Orders approving scheme of arrangements/amalgamations provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings, which are Freehold are held in the name of the Company as at the balance sheet date.
(ii) As explained to us, the inventories excluding stocks with third parties were physically verified during the year by the Management at reasonable intervals and no material discrepancies were noticed on physical verification. In respect of inventory lying with third parties, confirmations were obtained by management for substantial portions of stocks held by them at the year-end.
(iii) According to the information and explanations given to us, the Company has not granted any secured loans to companies, firms, or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013. In respect of unsecured loans to companies covered in the Register maintained under Section 189 of the Companies Act,2013:
(a) The terms and conditions of the grant of such loans are, in our opinion, prima facie, not prejudicial to the Companyâs interest.
(b) The schedule of repayment of principal and payment of interest has been stipulated and repayments or receipts of principal amounts and interest have been regular as per stipulations.
(c) There is no overdue amount remaining outstanding as at the balance sheet date.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 185 and 186 of the Companies Act, 2013 in respect of grant of loans, making investments and providing guarantees and securities, as applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit during the year in terms of provisions of Sections 73 to 76 or any other relevant provisions of the Companies Act, 2013.
(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, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value added Tax, Cess and other material statutory dues applicable to it with 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 and Excise Duty which have not been deposited as at March 31, 2018 on account of disputes are given below:
Name of Statute |
Nature of Dues |
Forum where Dispute is Pending |
Period to which the Amount Relates |
Amount (Rs. in Crores) |
Income Tax |
Income Tax |
Appellate Tribunal |
A.Y 2002-03 to A.Y 2011-12 and |
330.53 |
Act 19611 |
A.Y 2013-14 |
|||
Appellate Authority upto |
A.Y 2005-06, A.Y. 2010-11, A.Y. 2012-13 and |
40.99 |
||
Commissionerâs level |
A.Y 2014-15 |
|||
Central Excise Laws2 |
Excise Duty & Service |
High Court |
2008-09 to 2009-10 |
7.66 |
Tax including interest |
CESTAT |
1996-97, 1999-2000, 2000-01, 2005-06 to |
9.71 |
|
and penalty, as |
2007-08, 2010-11 to 2015-16 |
|||
applicable. |
Appellate Authority upto Commissionerâs level |
1989-90, 1995-96, 1998-99, 1999-2000, 2003-04 to 2006-07, 2008-09 to 2016-17 |
3.39 |
|
Sales Tax Laws3 |
Sales Tax |
Tribunal |
1990-91, 1995-96, 1997-98 to 2007-08, 2009-10, 2010-11 |
3.2 |
Appellate Authority upto |
1998-99 to 2016-17 |
7.76 |
||
Commissionerâs level |
||||
Custom Laws4 |
Customs Duty |
Appellate Authority upto Commissionerâs level |
2009-2010 to 2011-2012 |
1.44 |
1Net of Rs.344.49 crores paid under protest; 2Net of Rs.6.63 crores paid under protest; 3Net of Rs.5.14 crores paid under protest; 4Net of Rs.0.11 crores paid under protest.
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans or borrowings to financial institutions, banks and government and dues to debenture holders.
(ix) In our opinion and according to the information and explanations given to us, money raised by way of rights issue of equity shares during the year and the term loans have been applied by the Company for the purposes for which they were raised.
(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 requisite approval mandated by the provision 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 3 (xii) of the Order is not applicable.
(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 177 and 188 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) According to the information and explanations given to us, the Company has made private placement of fully convertible debentures during the year under review.
In respect of the above issue, we further report that:
a) the requirement of Section 42 of the Companies Act, 2013, as applicable, have been complied with; and
b) the amounts raised have been applied by the Company during the year for the purposes for which the funds were raised.
(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 persons connected with them and hence provisions of Section 192 of the Companies Act, 2013 are not applicable.
(xvi) The Company is not required to be registered under Section 45-I of the Reserve Bank of India Act, 1934.
For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm Registration No. 117366W/W-100018)
Rupen K. Bhatt
Partner
(Membership No. 046930)
Mumbai, May 28, 2018
Mar 31, 2017
Report on the Standalone Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the accompanying standalone financial statements of Piramal Enterprises 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 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 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 thereunder 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 thereunder.
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 auditorsâ 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.
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 16, 2016 and May 7, 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, on which we have expressed an unmodified opinion vide our report dated, May 12, 2017.
Our opinion is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
10. As required by the Companies (Auditorâs 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 Auditorsâ 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 Note 48;
ii. The Company has made provision as at March 31, 2017, as required under the applicable law or accounting standards, for material foreseeable losses, on long-term contracts - Refer Note 48 forming part of Notes to financial statements. The Company has derivative contracts as at March 31, 2017, for which there were no 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 during the year ended March 31, 2017;
iv. The Company has provided requisite disclosures in the standalone financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 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 53.
Annexure B to Independent Auditorsâ Report
Referred to in paragraph 10 of the Independent Auditorsâ Report of even date to the members of Piramal Enterprises Limited on the standalone financial statements as of and for the year ended March 31, 2017
i. (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation, of fixed assets.
(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 on Property, Plant & Equipment 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 granted unsecured loans, to twelve companies covered in the register maintained under Section 189 of the Act. The Company has not granted any secured/ unsecured loans to firms, LLPs or other parties covered in the register maintained under Section 189 of the Act.
(a) In respect of the aforesaid loans, the terms and conditions under which such loans were granted are not prejudicial to the Companyâs interest.
(b) In respect of the aforesaid loans, the schedule of repayment of principal and payment of interest has been stipulated, and the parties are repaying the principal amounts, as stipulated, and are also regular in payment of interest as applicable.
(c) In respect of the aforesaid loans, there is no amount which is overdue for more than ninety days.
iv. In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of Section 185 and 186 of the Companies Act, 2013 in respect of the loans and investments made, and guarantees and security provided by it.
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, profession tax, employeesâ state insurance, value added tax and service tax, though there has been a slight delay in a few cases, and is regular in depositing undisputed statutory dues, including provident fund, sales tax, income tax, duty of customs, duty of excise, cess 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 value added tax which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of customs 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* |
Period to which the amount relates |
Forum where the dispute is pending |
|
(Rs. In Crores) |
|||||
The Central Excise |
Excise duty including |
7.54 |
2008-2009 |
The High Court of Judicature at Indore |
|
Act, 1944 |
interest and penalty, as applicable |
8.85 |
1994-1995,1996-1997, 1999-2000 to 2000-2001, 2002-2003, 2005-2006 to 2007-2008, 2009-2010 to 2015-2016 |
CESTAT |
|
2.86 |
1989-1990, 1995-1996, 1996-1997, 1998-1999, 1999-2000, 2003-2004 to 2007-2008, 2009-2010 to 2013-2014 |
Appellate Authority Commissionerâs Level |
upto |
||
Service Tax (Finance |
Service tax including |
1.24 |
2009-2010 |
The High Court of Judicature at Indore |
|
Act, 1994) |
interest and penalty, |
0.90 |
2007-2008 to 2010-2011 and 2014-2015 |
CESTAT |
|
as applicable |
0.49 |
2005-2006 and 2009-2010 to 2014-2015 |
Appellate Authority Commissionerâs Level |
upto |
|
Custom Duty |
Payment of Duty |
0.20 |
2009-2010 to 2014-2015 |
Appellate Authority Commissionerâs Level |
upto |
Central Sales Tax Act |
Sales Tax including |
5.21 |
1990-1991, 1997-1998 to 2007-2008, 2009-2010, 2010-2011 |
Tribunal |
|
and Local Sales Tax |
interest and penalty, |
and 2013-2014 |
|||
as applicable |
12.45 |
1998-1999, 2000-2001, 2003-2004 to 2010-2011 and 2013-2014 |
Appellate Authority Commissionerâs Level |
upto |
|
Income Tax Act, 1961 |
Income tax including |
353.69 |
2001-2002 to 2005-2006 and 2008-2009 to 2010-2011 |
Income-tax Appellate Tribunal |
|
interest and penalty, |
149.16 |
2004-2005, 2005-2006, 2007-2008 and 2009-2010 to 2011-2012 |
Appellate Authority |
upto |
|
as applicable |
Commissionerâs level |
* Net of amounts paid under protest or otherwise;
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. In our opinion, and according to the information and explanations given to us, term loans have been applied for the purposes for which they were obtained. The Company has not raised any money by way of initial public offer or further public offer (including debt instruments).
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 the 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 entered into any non cash transactions with its directors or persons connected with him. 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
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Mumbai Partner
May 12, 2017 Membership Number: 048125
Mar 31, 2016
1. We have audited the accompanying standalone financial statements of
Piramal Enterprises Limited ("the Company"), which comprise the Balance
Sheet as at March 31,2016, the Statement of Profit and Loss, the Cash
Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
2. The Company''s Board of Directors is responsible for the matters
stated in Section 134(5) of the Companies Act, 2013 ("the Act") with
respect to the preparation of these standalone financial statements to
give a true and fair view of the financial position, financial
performance and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014. 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 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 standalone
financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules
made thereunder including the accounting standards and matters which
are required to be included in the audit report.
5. We conducted our audit 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 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 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 auditor considers internal financial control relevant
to the Company''s preparation of the 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 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 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 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 31,2016, and its profit and its cash
flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
9. 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 (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 B a statement on the
matters specified in paragraphs 3 and 4 of the Order.
10. 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, and the Cash
Flow Statement 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 Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on March 31,2016 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31,2016
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 31,2016 on its financial position in its
standalone financial statements - Refer Note 22 and 46 forming part of
Notes to financial statements;
ii. The Company has made provision as at March 31,2016, as required
under the applicable law or accounting standards, for material
foreseeable losses, on long-term contracts - Refer Note 46 forming part
of Notes to financial statements. The Company has derivative contracts
as at March 31, 2016, for which there were no 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 during the year ended March 31,2016.
Annexure B to Independent Auditors'' Report
Referred to in paragraph 9 of the Independent Auditors'' Report of even
date to the members of Piramal Enterprises Limited on the standalone
financial statements as of and for the year ended March 31,2016
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to coverall 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 programmer 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 12 on
fixed assets 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 granted unsecured loans, to nine companies
covered in the register maintained under Section 189 of the Act. The
Company has not granted any secured/unsecured loans to firms, LLPs or
other parties covered in the register maintained under Section 189 of
the Act.
(a) In respect of the aforesaid loans, the terms and conditions under
which such loans were granted are not prejudicial to the Company''s
interest.
(b) In respect of the aforesaid loans, the schedule of repayment of
principal and payment of interest has been stipulated, and the parties
are repaying the principal amounts, as stipulated, and are also regular
in payment of interest as applicable.
(c) In respect of the aforesaid loans, there is no amount which is
overdue for more than ninety days.
iv. The Company has not granted any loans or made any investments, or
provided any guarantees or security to the parties covered under
Sections 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
thereunder 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 income tax, profession tax, sales tax, value added tax, and service
tax, though there has been a slight delay in a few cases, and is
regular in depositing undisputed statutory dues, including provident
fund, employees'' state insurance, duty of customs, duty of excise, cess
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 value added tax which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, service tax,
and duty of excise as at March 31, 2016 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 relates
(Rs. In
Crores)
0.01 1993-1994
Excise duty
including interest 1996-1997,1999
to 2001,2005 to 2008,
The Centra Excise
Act, 1944 4.21
and penalty, as
applicable 2009-2010 and 2011
to 2015
1989-1990,1995 to
1996,1998-1999,
2.55 2003 to 2007, 2009
to 2014,
1.24 2009 to 2011 and
2014-2015
Service tax
including
interest
Service Tax (Finance
Act, 1994) 0.20
and penalty,
as applicable 2007-2008, 2010 to
2012 and 2013-2015
Custom Duty Payment of Duty 0.20 2009 to 2015
1995-1996,1997 to
2008, 2009 to 2011
Central Sales Tax
Act and Local Sales Tax 3.36
including
interest and and 2013-2014
Sales Tax penalty, as
applicable
6.27 1998-1999, 2000 to
2012 and 2013-2014
354.05 1999-2000. 2001 to
2007. 2008 to 2011
Income tax
including
interest
Income Tax Act, 1961 and penalty,
as applicable 148.75 2004 to 2006,
2007-2008, 2009 to
2012
Name of the Statute Forum where the dispute is pending
The Central Excise Act, 1944 The High Court of Judicature at Indore
CESTAT
Appellate Authority upto Commissioner''s
Level
CESTAT
Service Tax Appellate Authority upto Commissioner''s
Level
Custom Duty Appellate Authority upto Commissioner''s
Level
Central Sales Tax Act Tribunal
Appellate Authority upto Commissioner''s
Level
Income Tax Act, 1961 Income-tax Appellate Tribunal
Appellate Authority upto Commissioner''s
level
* Net of amounts paid under protest or otherwise
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 on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the Management except
as stated in Note 50 to the financial statements in respect of a fraud
on the Company committed by an erstwhile employee resulting in losses
to the Company amounting Rs. 3.18 crores in the current year, for which
Management has taken appropriate remedial measures.
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 ofClause3(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 Accounting Standard (AS) 18,
Related Party Disclosures specified under Section 133 of the Act, read
with Rule 7 of the Companies (Accounts) Rules, 2014.
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 entered into any non cash transactions with
its directors or persons connected with him. 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
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Mumbai Partner
May 16, 2016 Membership Number: 048125
Mar 31, 2016
1. We have audited the accompanying standalone financial statements of
Piramal Enterprises Limited ("the Company"), which comprise the Balance
Sheet as at March 31,2016, the Statement of Profit and Loss, the Cash
Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information.
Management''s Responsibility for the Standalone Financial Statements
2. The Company''s Board of Directors is responsible for the matters
stated in Section 134(5) of the Companies Act, 2013 ("the Act") with
respect to the preparation of these standalone financial statements to
give a true and fair view of the financial position, financial
performance and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
Accounting Standards specified under Section 133 of the Act, read with
Rule 7 of the Companies (Accounts) Rules, 2014. 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 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 standalone
financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules
made thereunder including the accounting standards and matters which
are required to be included in the audit report.
5. We conducted our audit 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 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 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 auditor considers internal financial control relevant
to the Company''s preparation of the 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 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 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 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 31,2016, and its profit and its cash
flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
9. 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 (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 B a statement on the
matters specified in paragraphs 3 and 4 of the Order.
10. 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, and the Cash
Flow Statement 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 Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.
(e) On the basis of the written representations received from the
directors as on March 31,2016 taken on record by the Board of
Directors, none of the directors is disqualified as on March 31,2016
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 31,2016 on its financial position in its
standalone financial statements - Refer Note 22 and 46 forming part of
Notes to financial statements;
ii. The Company has made provision as at March 31,2016, as required
under the applicable law or accounting standards, for material
foreseeable losses, on long-term contracts - Refer Note 46 forming part
of Notes to financial statements. The Company has derivative contracts
as at March 31, 2016, for which there were no 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 during the year ended March 31,2016.
Annexure B to Independent Auditors'' Report
Referred to in paragraph 9 of the Independent Auditors'' Report of even
date to the members of Piramal Enterprises Limited on the standalone
financial statements as of and for the year ended March 31,2016
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased programme designed to coverall 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 programmer 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 12 on
fixed assets 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 granted unsecured loans, to nine companies
covered in the register maintained under Section 189 of the Act. The
Company has not granted any secured/unsecured loans to firms, LLPs or
other parties covered in the register maintained under Section 189 of
the Act.
(a) In respect of the aforesaid loans, the terms and conditions under
which such loans were granted are not prejudicial to the Company''s
interest.
(b) In respect of the aforesaid loans, the schedule of repayment of
principal and payment of interest has been stipulated, and the parties
are repaying the principal amounts, as stipulated, and are also regular
in payment of interest as applicable.
(c) In respect of the aforesaid loans, there is no amount which is
overdue for more than ninety days.
iv. The Company has not granted any loans or made any investments, or
provided any guarantees or security to the parties covered under
Sections 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
thereunder 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 income tax, profession tax, sales tax, value added tax, and service
tax, though there has been a slight delay in a few cases, and is
regular in depositing undisputed statutory dues, including provident
fund, employees'' state insurance, duty of customs, duty of excise, cess
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 value added tax which have not been deposited on account of any
dispute. The particulars of dues of income tax, sales tax, service tax,
and duty of excise as at March 31, 2016 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 relates
(Rs. In
Crores)
0.01 1993-1994
Excise duty
including interest 1996-1997,1999
to 2001,2005 to 2008,
The Centra Excise
Act, 1944 4.21
and penalty, as
applicable 2009-2010 and 2011
to 2015
1989-1990,1995 to
1996,1998-1999,
2.55 2003 to 2007, 2009
to 2014,
1.24 2009 to 2011 and
2014-2015
Service tax
including
interest
Service Tax (Finance
Act, 1994) 0.20
and penalty,
as applicable 2007-2008, 2010 to
2012 and 2013-2015
Custom Duty Payment of Duty 0.20 2009 to 2015
1995-1996,1997 to
2008, 2009 to 2011
Central Sales Tax
Act and Local Sales Tax 3.36
including
interest and and 2013-2014
Sales Tax penalty, as
applicable
6.27 1998-1999, 2000 to
2012 and 2013-2014
354.05 1999-2000. 2001 to
2007. 2008 to 2011
Income tax
including
interest
Income Tax Act, 1961 and penalty,
as applicable 148.75 2004 to 2006,
2007-2008, 2009 to
2012
Name of the Statute Forum where the dispute is pending
The Central Excise Act, 1944 The High Court of Judicature at Indore
CESTAT
Appellate Authority upto Commissioner''s
Level
CESTAT
Service Tax Appellate Authority upto Commissioner''s
Level
Custom Duty Appellate Authority upto Commissioner''s
Level
Central Sales Tax Act Tribunal
Appellate Authority upto Commissioner''s
Level
Income Tax Act, 1961 Income-tax Appellate Tribunal
Appellate Authority upto Commissioner''s
level
* Net of amounts paid under protest or otherwise
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 on or by the Company, noticed or reported during the
year, nor have we been informed of such case by the Management except
as stated in Note 50 to the financial statements in respect of a fraud
on the Company committed by an erstwhile employee resulting in losses
to the Company amounting Rs. 3.18 crores in the current year, for which
Management has taken appropriate remedial measures.
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 ofClause3(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 Accounting Standard (AS) 18,
Related Party Disclosures specified under Section 133 of the Act, read
with Rule 7 of the Companies (Accounts) Rules, 2014.
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 entered into any non cash transactions with
its directors or persons connected with him. 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
Firm Registration Number: 301112E
Chartered Accountants
Jeetendra Mirchandani
Mumbai Partner
May 16, 2016 Membership Number: 048125
Mar 31, 2014
Report on the Financial Statements
1. We have audited the accompanying financial statements of Piramal
Enterprises Limited (the "Company"), which comprise the Balance Sheet
as at March 31, 2014, and 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 (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. In 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, 2014;
(b) in the case of the Statement of Profit and Loss, of the loss 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 ''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 (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) 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 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, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014, 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 Piramal Enterprises Limited on the financial
statements as of and for the year ended March 31, 2014.
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(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. (a) The Company has granted unsecured loans, to two companies
covered in the register maintained under Section 301 of the Act. The
maximum amount involved during the year and the year-end balance of
such loans aggregated to Rs. 168,981 Lakhs and Rs. 3,500 Lakhs,
respectively. The Company has not granted any secured/ unsecured loans
to firms or other parties covered in the register maintained under
Section 301 of the Act.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loans, the parties are repaying the
principal amounts, as stipulated, and are also regular in payment of
interest as applicable.
(d) In respect of the aforesaid loans, there is no overdue amount more
than Rupees One Lakh.
(e) 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 Clause
4(iii) (f) and (g) of the said Order are not applicable to the Company.
iv. 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.
v. (a) According to the information and explanations given to us, we
are of the opinion that the particulars of all contracts or
arrangements that need to be entered into the register maintained under
Section 301 of the Act, have been so entered.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
vi. 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
there under.
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. 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.
ix. (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 profession tax, service tax, TDS, excise duty and provident fund and
is regular in depositing undisputed statutory dues, including investor
education and protection fund, employees'' state insurance, sales tax,
income tax, wealth tax, customs 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 March 31, 2014 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 Forum where
the
(Rs.
In Lakhs) amount relates dispute is
pending
The Central
Excise Act, Excise duty
including 1 1993-1994 The High
Court of
1944 interest
and
penalty,
as Judicature at
Indore
applicable 1,136 1989 to 2013 CESTAT
239 1989 to 2012 Appellate
Authority upto
Commissioner''s
level
Central
Sales Tax
Act and Sales Tax
including 335 1995-96,
1997-98,
1999 to Tribunal
Local Sales
Tax Act interest
and
penalty, as 2005,2006-07,
2008-10
applicable 608 1998-99, 2000
to 2011 Appellate
Authority upto
Joint
Commissioner
Level
Income Tax
Act, 1961 Income tax
including 10802 1999-00,
2001-02,2002-03, Income Tax
Appellate
interest
and
penalty, as 2004-05,
2005-06, 2006- Tribunal
applicable 07, 2008-09
15628 2004-05,
2005-06, 2007- Appellate
Authority upto
08, 2009-10,
2010-11 and Commissioner''s
level
2011-12
* Net of amounts paid under protest or otherwise
x. The Company has no accumulated losses as at the end of the financial
year and it has incurred cash losses in the financial year ended on
that date and in the immediately preceding financial year.
xi. 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 as at the balance sheet date.
xii. In our opinion, the Company has maintained adequate documents and
records in the cases where it has granted loans and advances on the
basis of security by way of pledge of shares, debentures and other
securities.
xiii. 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.
xiv. 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.
xv. In our opinion, and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks or financial institutions
during the year, are not prejudicial to the interest of the Company.
xvi. In our opinion, and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
xvii. 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 company has used funds raised on short-term basis for
long-term investment. The Company has obtained commercial papers
amounting to Rs.224576 Lakhs on a short term basis, which has been used
for long term investments.
xviii. 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.
xix. The Company issued unsecured redeemable debentures during previous
year, aggregating Rs.35000 Lakhs which are outstanding at the year-end,
in respect of which it is not required to create security or charge.
xx. 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.
xxi. 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
Firm Registration Number: 301112E
Chartered Accountants
Vilas Rane
Mumbai Partner
May 05, 2014 Membership Number: 033220
Mar 31, 2013
Report on the Financial Statements
1. We have audited the accompanying financial statements of Piramal
Enterprises Limited (formerly known as Piramal Healthcare Limited) (the
"Company"), which comprise the Balance Sheet as at March 31, 2013,
and 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 referred to in sub-section
(3C) of section 211 of ''the Companies Act, 1956'' of India (the
"Act"). 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 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. 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. In 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, 2013;
(b) in the case of the Statement of Profit and Loss, of the loss 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 ''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 (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) In our opinion, proper books of account as required by law have
been kept by the Corhpany 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 March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 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 Auditors'' Report of even date to
the members of Piramal Enterprises Limited on the financial statements
as of and for the year ended March 31, 2013
i. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets,
(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 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. (a) The Company has granted unsecured loans, to two companies
covered in the register maintained under Section 301 of the Act. The
maximum amount involved during the year and the year-end balance of
such loans aggregated to Rs. 126,088 lakhs and Rs. 16,596 lakhs,
respectively. The Company has not granted any secured/ unsecured loans
to firms or other parties covered in the register maintained under
Section 301 of the Act.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loans, the parties are repaying the
principal amounts, as stipulated, and are also regular in payment of
interest as applicable. -
(d) In respect of the aforesaid loans, there is no overdue amount more
than Rupees One Lakh.
(e) 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 Clause
4(iii) (f) and (g) of the said Order are not applicable to the Company.
iv. 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.
v. (a) According to the information and explanations given to us, we
are of the opinion that the particulars of all contracts or
arrangements that need to be entered into the register maintained under
Section 301 of the Companies Act, 1956 have been so entered.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
vi. The Company has not accepted any deposits from the public within
the meaning of jRs.ecTt6ns 58A and 58AA of the Act and the rules framed
there under.
vii. In our opinion, the Company has an internal audit system
commensurate with its size and the nature of its business.
viii. 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.
ix. (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 employees'' state insurance, income tax, service tax, sales tax and
excise duty, and is regular in depositing undisputed statutory dues,
including provident fund, investor education and protection fund,
wealth tax, customs 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,
service-tax and customs duty which have not been deposited on account
of any dispute. The particulars of dues of income tax, sales tax, and
excise duty as at March 31, 2013 which have not been deposited on
account of a dispute, are as follows:
Name of the Statute Nature ot dues Amounr
(Rs.Lakhs)
The Central Excise Excise duty including 269
Act,1944 interest and penalty,
as applicable
724
1
Central Sales Tax Sales Tax including 577
Act and Local Sales interest and penalty,
Tax Act as applicable
282
Income-Tax Act, Income tax including 16,381
1961 interest and penalty,
as applicable
20
Name of the Statute Period to which the Forum where the
amount relates dispute is pending
The Central Excise
Act 1944 1989-2012 Appellate Authority-
upto Commissioner''s
Level
1989-2011 CESTAT
1993-1994 The High Court of
Judicature at Indore
Central Sales Tax Act 1998-2010 Appellate Authority
- upto Joint Commissioner
Level
1990-2009 Tribunal
Income Tax Act 1961 2004-05,2005-06,
2006-07, Appellate Authority-
2007-08, 2008-09,
2009-10, upto Commissioner''s
2010-11 and 2011-12 level
1999-00,2001-02,
2002-03, Income Tax Appellate
2004-05 and 2005-06 Tribunal
*Net of amounts paid under protest or otherwise
x. The Company has no accumulated losses as at the end of the
financial year and it has incurred cash losses in the financial year
ended on that date and has not incurred cash losses in the immediately
preceding financial year.
xi. 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 as at the balance sheet date.
xii. In our opinion, the Company has maintained adequate documents and
records in the cases where it has granted loans and advances on the
basis of security by way of pledge of shares, debentures and other
securities.
xiii. 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.
xiv. 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.
xv. In our opinion, and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks or financial institutions
during the year, are not prejudicial to the interest of the Company.
xvi. In our opinion, and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
xvii. 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 Company has used funds raised on short-term basis for
long-term investment. The Company has obtained commercial papers
amounting to Rs.98,112 lakhs on a short term basis, which has been used
for investment in wholly owned subsidiaries.
xviii.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.
xix. The Company has created security in respect of debentures issued
and outstanding at the year-end. The Company issued unsecured
redeemable non convertible debentures , aggregating X 35,000 lakhs
which are outstanding at the year-end, in respect of which it is not
required to create security or charge.
xx. 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.
xxi. 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
Firm Registration Number: 301112E
Chartered Accountants
Vilas Rane
Mumbai Partner
May 03, 2013 Membership Number: 33220
Mar 31, 2012
1. We have audited the attached Balance Sheet of Piramal Healthcare
Limited (the "Company") as at March 31, 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 '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, 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 March 31, 2012 and taken on record by the Board of
Directors, none of the directors is disqualified as on March 31, 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 March 31, 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.
Referred to in paragraph 3 of the Auditors' Report of even date to
the members of Piramal Healthcare Limited on the financial statements
as of and for the year ended March 31, 2012
1. (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(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 stocks with third parties) has been
physically verified by the Management during the year.
In respect of inventory lying with third parties, these have 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.
3. (a) The Company has granted unsecured loans, to five companies
covered in the register maintained under Section 301 of the Act. The
maximum amount involved during the year and the year-end balance of
such loans aggregated to Rs 138,621 lakhs and Rs 57,514 lakhs,
respectively.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loans, the parties are repaying the
principal amounts, as stipulated, and are also regular in payment of
interest, as applicable.
(d) In respect of the aforesaid loans, there is no overdue amount more
than Rupees One Lakh.
(e) 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.
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. (a) In our opinion, and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
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
there under.
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 the 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 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,
service-tax and customs duty which have not been deposited on account
of any dispute.
Referred to in paragraph 3 of the Auditors' Report of even date to
the members of Piramal Healthcare Limited on the financial statements
as of and for the year ended March 31, 2012 According to the
information and explanations given to us and the records of the Company
examined by us, the particulars of dues of income tax, sales tax and
excise duty as at March 31, 2012 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 Forum where the
dispute
(Rs.Lakhs) amount
relates is pending
The Central Excise Excise
duty including 233 1989-2011 Appellate
Authority -
Act,1944 interest and
penalty, upto
Commissioner's
as applicable Level
706 1989-2008 CESTAT
1 1994-1995 The High Court of
Judicature
at Indore
Central
Sales Tax
Act Sales Tax including 828 1999-2010 Appellate
Authority - upto
and Local
Sales Tax interest and penalty, Joint
Commissioner
Level
Act as applicable 259 1991-2009 Tribunal
Income-Tax
Act, 1961 Income tax including 20,591 2004-05,
2005-06,
2006-07, Appellate
Authority - upto
interest and penalty, 2007-08,
2008-09,
2009-10 Commissioner's
level
as applicable and 2010-11
10,086 1999-00,
2006-07,
2007- Income Tax
Appellate
08,
2008-09,
2009-10 and Tribunal
2010-11
* Net of amounts paid under protest or otherwise
10. The Company has no accumulated losses.
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. In our opinion, the Company has maintained adequate documents and
records in the cases where the Company has granted 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, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion, and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company for loans taken by others from banks or financial institutions
during the year, are not prejudicial to the interest of the Company.
16. In our opinion, and according to the information and explanations
given to us, the term loans have been applied, on an overall basis, for
the purposes for which they were obtained.
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 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 created security in respect of debentures issued
and outstanding at the year-end.
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
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
Firm Registration Number: 301112E
Chartered Accountants
Partha Ghosh
Mumbai Partner
May 03, 2012 Membership Number: F-55913
Mar 31, 2011
1. We have audited the attached Balance Sheet of Piramal Healthcare
Limited, as at March 31, 2011, 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 statements
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 ÃOrder) issued by the Central Government of India in
terms of sub-section (4A) of Section 227 of ÃThe Companies Act, 1956
of India (the ÃAct) 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 said
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 March 31, 2011 and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2011 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 March 31, 2011; (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 Cash Flow Statement, of the cash flows for the year ended
on that date.
ANNEXURE TO AUDITORS REPORT
[Referred to in paragraph 3 of Auditors Report of even date to the
members of Piramal Healthcare Limited on the financial statements for
the year ended March 31, 2011]
1. (a) The Company is maintaining proper records showing full
particulars including quantitative details and situation of
fixed assets.
(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, the Company has disposed of a substantial part of
fixed assets during the year. On the basis of our examination of the
books and records of the Company, and according to the information and
explanations given to us, in our opinion, the disposal of the said part
of fixed assets has not affected the going concern status of the
Company.
2. (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
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.
3. (a) The Company has granted unsecured loans, to Four Companies
covered in the register maintained under Section
301 of the Act. The maximum amount involved during the year and the
year-end balance of such loans aggregates to Rs.216,423 lakhs and
Rs.55,670 lakhs respectively.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loans, the parties are repaying the
principal amounts as stipulated and are also regular in payment of
interest, where applicable.
(d) In respect of the aforesaid loans granted, there is no overdue
amount more than Rupees One Lakh.
(e) The Company has not taken loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
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, 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. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or
arrangements referred to in Section 301 of the Act have been entered in
the register required to be maintained under that section.
(b) In our opinion and according to the information and explanations
given to us, the transactions made in pursuance of such contracts or
arrangements and exceeding the value of Rupees Five Lakhs in respect of
any party during the year have been made at prices which are reasonable
having regard to the prevailing market prices at the relevant time.
6. The Company has not accepted any deposits from public within the
meaning of Sections 58A and 58AA of the Act and the rules framed there
under.
[Referred to in paragraph 3 of Auditors Report of even date to the
members of Piramal Healthcare Limited on the financial statements for
the year ended March 31, 2011]
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 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,
Service Tax, Customs Duty and Cess which have not been deposited on
account of any dispute.
The particulars of dues of Excise Duty, Sales-Tax and Income-Tax as at
March 31, 2011 which have not been deposited on account of a dispute
are as follows -
Name of the Nature of dues Amount* Period to which Forum where the
statute (Rs. Lak
hs) the amount dispute is
pending
relates
The Central
Excise Excise duty inc
luding 255 1995-2010 Appellate
Authority Ã
Act,1944 interest and
penalty, upto Commis
sioners
as applicable Level
888 1989-2006 CESTAT
1 1994-1995 The High Cou
rt of
Judicature at
Indore
Central
Sales Tax
Act Sales Tax
including 883 1998-2010 Appellate Aut
hority
and Local
Sales Tax interest and
penalty, Ã upto Joint
Act as applicable Commissioner
Level
Tribunal
111 1991 to 2007
Income-Tax
Act, 1961 Income tax
including 14,794.32 2003-04,
2004-05, Appellate Autho
rity Ã
2005-06,
2006-07, upto Commissio
ners
as applic
able 2007-08,
2008-09, level
2009-10 &
2010-11
20.45 1999-00 Income Tax App
ellate
Tribunal
* Net of amounts paid under protest or otherwise
[Referred to in paragraph 3 of Auditors Report of even date to the
members of Piramal Healthcare Limited on the financial statements for
the year ended March 31, 2011]
10. The Company has no accumulated losses as at March 31, 2011 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 explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank 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.
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, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion, and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company, for loans taken by others from banks during the year, are not
prejudicial to the interest of the Company.
16. In our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
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 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 created security in respect of debentures issued
and outstanding at the year-end.
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
Firm Registration Number: 301112E
Chartered Accountants
Partha Ghosh
Mumbai, Partner
Dated : May 6, 2011 Membership No. F-55913
Mar 31, 2010
1. We have audited the attached Balance Sheet of Piramal Healthcare
Limited, as at March 31, 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 statements
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 ofThe 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 said
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 ot
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 March 31, 2010 and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2010 from being
appointed as a director in terms of clause (g) of sub-section (1) ot
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 March 31, 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 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 Piramal Healthcare Limited on the financial statements for
the year ended March 31, 2010]
1. (a) The Company is maintaining proper records showing full
particulars including quantitative details and situation of fixed
assets.
(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 Company during the year.
2. (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 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.
3. (a) The Company has granted unsecured loans tî four Companies
covered in the register maintained under Section 301 of the Act. The
maximum amount involved during the year and the year-end balance of
such loans aggregates to Rs. 179,350 lakhs and Rs.44,727 lakhs
respectively.
(b) In our opinion, the rate of interest and other terms and conditions
of such loans are not prima facie prejudicial to the interest of the
Company.
(c) In respect of the aforesaid loans, the parties are repaying the
principal amounts as stipulated and are also regular in payment of
interest, where applicable.
(d) In respect of the aforesaid loans granted, there is no overdue
amount more than Rupees One Lakh.
(e) The Company has not taken loans, secured or unsecured, from
companies, firms or other parties covered in the register maintained
under Section 301 of the Act.
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, 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. (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in Section 301 of the Act have been entered in the register
required to be maintained under that section. (b) In our opinion and
according to the information and explanations given to us, the
transactions made in pursuance of such contracts or arrangements and
exceeding the value of Rupees Five Lakhs in respect of any party during
the year have been made at prices which are reasonable having regard to
the prevailing market prices at the relevant time.
6. In our opinion and according to the information and explanations
given to us, the company has complied with the provisions of Sections
58 A and 58AA or any other relevant provisions of th,e 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 March 31, 2010. 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 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.
9. (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, Service Tax, Customs Duty and Cess which have not been deposited
on account of any dispute.
The particulars of dues of Excise Duty, Sales-Tax and Income-Tax as at
March 31, 2010 which have not been deposited on account of a dispute
are as follows :
Name of the statute Nature of dues Amount *
(Rs. Lakhs)
The Central Excise Actm, Excise duty including interest 131
1944 and penalty, as applicable
888
1
Central Sales Tax Act and Sales Tax including interest 387
Local Sales Tax Act and penalty, as applicable
123
Income-tax Act, 1961 Income tax including interest 842
and penalty, as applicable
885
Name of the Statue Period to which Forum where the dispute is
the amount relates pending
The Central Excise Act,
1944 1995-2008 Appellate Authority - upto
Commissioners Level
1989-2006 CESTAT
1994-1995 The High Court of
Judicature at Indore
Central Sales Tax Act and
Local Sales Tax Act 1998-2010 Appellate Authority -
upto Joint
Commissioner Level
1991 to 2004 Tribunal
1999-2000, 2003-2004, Appellate Authority - upto
2005-2006 and 2006-2007 Commissioner Level
Income-tax Act, 1961 1998-1999, 2000 to
2006 Income Tax Appellate Tribunal
* Net of amounts paid under protest or otherwise
10. The Company has no accumulated losses as at March 31, 2010 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 explanations given to us, the Company has not defaulted
in repayment of dues to any financial institution or bank 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.
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, the Company is not a dealer or trader in shares,
securities, debentures and other investments.
15. In our opinion, and according to the information and explanations
given to us, the terms and conditions of the guarantees given by the
Company, for loans taken by others from banks during the year, are not
prejudicial to the interest of the Company.
16. In our opinion, and according to the information and explanations
given to us, on an overall basis, the term loans have been applied for
the purposes for which they were obtained.
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 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 created security in respect of debentures issued
and outstanding at the year-end.
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
Firm Registration Number: 301112E
Chartered Accountants
Partha Ghosh
Izmir, Partner
Dated: May 7, 2010 Membership Number F-55913