Mar 31, 2023
To The Members of SKF India Limited
Report on the Audit of the Standalone Financial
Statements
We have audited the accompanying standalone financial statements of SKF India Limited (âthe Company"), which comprise the Balance Sheet as at March 31, 2023, and the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (âthe 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, (âInd AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, and its profit, total comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibility for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Information Other than the Financial Statements and Auditorâs Report Thereon
⢠The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis and Board''s Report including Annexures to Board''s Report, but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon.
⢠Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
⢠In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.
⢠If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the Company''s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
The Company''s Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Auditorâs Responsibility for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal financial control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone financial statements in place and the operating effectiveness of such controls.
⢠Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.
⢠Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether
a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
⢠Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the standalone financial statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
The comparative standalone financial statements of the Company forthe yearended March 31, 2022 included in these standalone financial statements have been audited by the predecessor auditor. The report of the predecessor auditor on the comparative standalone financial statements dated May 11, 2022 expressed an unmodified opinion on the standalone financial statements and internal control over financial reporting.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143(3) of the Act, based on
our audit, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.
e) On the basis of the written representations received from the directors as on March 31, 2023 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023 from being appointed as a director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure A". 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 according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.
h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements. Refer Note 37 to the standalone financial statements.
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company, except Rs. 0.20 million which is held in abeyance due to legal cases pending. Refer Note 20 of the standalone financial statements.
iv. (a) The Management has represented
that, to the best of it''s knowledge and belief, other than as disclosed in the notes to the standalone financial statements no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities (âIntermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. Refer Note 46 of the standalone financial statements.
(b) The Management has represented, that, to the best of it''s knowledge and belief, other than as disclosed in the notes to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (âUltimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. Refer Note 46 of the standalone financial statements.
(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.
v. The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.
As stated in note 34(b) to the standalone financial statements, the Board of Directors of the Company has proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend proposed is in accordance with section 123 of the Act, as applicable.
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 w.e.f. 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.
2. As required by the Companies (Auditor''s Report) Order, 2020 (âthe Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in âAnnexure 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)
Partner
Place: Pune (Membership No. 102637)
Date: May 17, 2023 UDIN: 23102637BGXUSQ1017
Mar 31, 2022
Opinion
1. We have audited the accompanying standalone financial statements of SKF India Limited ("the Companyâ), which comprise the Balance Sheet as at March 31, 2022, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.
2. I n 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 Actâ) 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, 2022 and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.
3. 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 Financial Statementsâ 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 financial statements under the provisions of the Act and the Rules 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 we have obtained is sufficient and appropriate to provide a basis for our opinion.
4. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter |
How our audit addressed the key audit matter |
Assessment of Contingencies relating to Transfer pricing Matters |
|
Refer to note 2 (A) and 38 of the standalone financial statements for the related disclosures |
|
The Company has received income tax demands mainly pertaining to disallowances towards pricing of intragroup services for the financial years 2010-11 to 2016-17. The aggregate amount of demand on these matters is '' 2,819 million (including interest of '' 1,048 million as per the demand orders), which have been disclosed as Contingent Liabilities in the Standalone Financial Statements. The Company has filed appeals against the above orders with appropriate tax authorities. The management''s assessment, as supported by their tax expert''s views, is that no provision is required against these matters. The assessment of the likely outcome of the appeals and the need for provision against the demands in case of an unfavourable outcome, is an area of significant judgement requiring involvement of tax expert and evaluation of data presented during the assessment proceedings. This has been considered a key audit matter in view of the uncertain outcome of the litigations and involvement of significant management judgement in assessing the probability of outflow of economic resources. |
Our audit procedures included: ⢠Understanding and evaluation of processes and controls designed and implemented by the management for assessment of tax contingencies and testing their operating effectiveness. ⢠Verification of the supporting documents such as agreements and invoices pertaining to the group costs incurred by the Company. ⢠Enquiry with the management on their assessment of the probability of outcome and the likelihood of outflow of economic resources. ⢠Evaluation of the management assessment including view from the management''s tax expert and the submissions made by the Company to tax authorities, with the involvement of auditor''s tax experts to examine the positions taken. ⢠Assessed the adequacy of disclosures in the standalone financial statements. On the basis of the above procedures performed, we noted the management''s assessment of the contingent liabilities in respect of transfer pricing matters to be reasonable. |
5. The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Board''s report, but does not include the standalone financial statements and our auditors'' 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.
I n 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 in the 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 gover nance for the financial statements
6. 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, changes in equity 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. 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.
7. In preparing the 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 responsibilities for the audit of the financial statements
8. Our objectives are to obtain reasonable assurance about whether the 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 financial statements.
9. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the 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 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 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 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 financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
10. 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.
11. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 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
12. As required by the Companies (Auditor''s Report) Order, 2020 ("the Orderâ), issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
13. 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 Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account
(d) I n our opinion, the aforesaid standalone financial statements comply with the 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, 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure Aâ.
(g) 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 financial statements - Refer Note 38 to the standalone financial statements;
ii. The Company was not required to recognise a provision as at March 31, 2022 under the applicable law or accounting standards, as it does not have any material foreseeable losses on long-term contract. The Company did not have any derivative contracts as at March 31, 2022.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year.
iv. (a) The management has represented
that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other persons or entities, including foreign entities ("Intermediariesâ), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries (Refer Note 46 to the standalone financial statements);
(b) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the Company from any persons or entities, including foreign
entities (âFunding Partiesâ), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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 Beneficiariesâ) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries (Refer Note 46 to the standalone financial statements); and
(c) Based on such audit procedures that we 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 (a) and (b) contain any material misstatement.
v The dividend declared and paid during the year by the Company is in compliance with Section 123 of the Act.
14. 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.
For Price Waterhouse & Co Bangalore LLP Firm Registration Number: 007567S/ S200012 Chartered Accountants
Amit Borkar
Partner
Place: Pune Membership Number 109846
Date: May 11, 2022 UDIN: 22109846AITNUE1395
Mar 31, 2019
Report on the audit of the financial statements
Opinion
1. We have audited the accompanying financial statements of SKF India Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2019, the statement of Profit and Loss (including Other Comprehensive Income), statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information.
2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2019, and total comprehensive income (comprising of profit and other comprehensive income), changes in equity and its cash flows for the year then ended.
Basis for opinion
3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditorâs Responsibilities for the Audit of the 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 financial statements under the provisions of the Companies Act, 2013 and the Rules 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 we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key audit matters
4. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter |
How our audit addressed the key audit matter |
Assessment of recoverability of loan given to a fellow subsidiary (Refer note 6 and 1.12 of the financial statements for the related disclosures) |
|
The Company has outstanding loan balance (including interest accrued) of Rs.1,452 million as at March 31, 2019 in respect of loans given to a fellow subsidiary (the borrower), which has been incurring losses and for which the repayment period had been extended in earlier years. The management has carried out an assessment of recoverability of the loan and believes the amount to be good and fully recoverable and that no provision for expected credit loss is required, in view of the following : - No defaults in repayment of principal and interest; - A favourable security to loan ratio based on an external valuation report used by the management during the year; - Financial and operational support extended by the borrowerâs holding company, whenever required; - The loan being the only secured borrowing taken by the borrower; - Assumptions used by fellow subsidiary in preparation of future cash flows were found reasonable; - Improvement in the operational and financial performance of the borrower resulting in cash profits in last couple of years. The matter has been identified as a key audit matter in view of the significant amount outstanding, revision of repayment terms in the past and the fact that the fellow subsidiary is not a profit making entity. |
Our audit procedures and testing of the recoverability included the following: - Understood and evaluated the design and tested the operating effectiveness of the Companyâs controls over assessment of recoverability of loans. - Verified that the first charge by way of hypothecation of all the fixed assets is registered by fellow subsidiary with the Registrar of Companies. - Checked the computation of security to loan ratio on the basis of the valuation report of secured assets used by the management during the year and assessed whether the loan balance is adequately covered. - Verified the repayment of principal and interest payments made during the year and checked whether those were in accordance with the repayment terms. - Read the minutes of meetings of Board of Directors for discussion around performance and necessity of any provisions against the loans. - Perused the financial statements of fellow subsidiary to ensure that it has no secured borrowing other than loan from the Company. - Performed limited procedures to test the assumptions (mainly revenue growth) used by fellow subsidiary in preparation of its forecast of future cash flows and whether it is reasonable in context of assessing their ability to repay the loan. |
Key audit matter |
How our audit addressed the key audit matter |
- Assessed the adequacy of disclosures in the financial statements. On the basis of the above procedures performed, there were no significant exceptions observed in the managementâs assessment of recoverability of the loan to the fellow subsidiary |
|
Assessment of contingent liabilities relating to litigations in respect of Transfer pricing Matters (Refer note 39 and 2(A) of the financial statements for the related disclosures) |
|
The Company has received income tax demands mainly pertaining to disallowances towards pricing of intragroup services for the financial years 2010-11 to 2013-14. The demand (including interest) on these matters is INR 1,620 million, which have been disclosed as Contingent Liabilities in the financial statements. The Company has filed appeals against the above orders with appropriate tax authorities. The managementâs assessment as supported by their tax expertsâ views, is that no provision is required against these matters. The assessment of outcome from and the need for provisions in case of an unfavourable outcome is an area of significant judgement involving the tax expert as well as evaluation of data presented during the assessment proceedings. This has been considered a key audit matter in view of the uncertain outcome of the litigations and involvement of significant management judgement in assessing the probability of outflow of economic resources. |
Our audit procedures included : - Understanding and evaluation of processes and controls designed and implemented by the management for assessment of litigations and testing their operating effectiveness; - Verification of the supporting documents such as agreements and invoices pertaining to the group costs incurred by the Company. - Discussion with the management on their assessment of the probability of outcome and the likelihood of outflow of economic resources. - Evaluation of the management assessment including view from the managementâs tax experts and the submissions made by the Company to tax authorities, with the involvement of auditorsâ tax experts to examine the positions taken. - Assessed the adequacy of disclosures in the financial statements. On the basis of the above procedures performed, we observed the managementâs assessment of the contingent liabilities relating to litigations in respect of transfer pricing matters to be reasonable. |
Other Information
5. The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the annual report, but does not include the financial statements and our auditorâs report thereon.
Our opinion on the 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the 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 financial statements
6. 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 financial statements that give a true and fair view of the financial position, financial performance, changes in equity 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. 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 implementation and maintenance of 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 statement that give a true and fair view and are free from material misstatement, whether due to fraud or error.
7. In preparing the 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 responsibilities for the audit of the financial statements
8. Our objectives are to obtain reasonable assurance about whether the 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 financial statements.
9. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the 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 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 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 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 financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
10. 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.
11. 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.
12. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 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
13. As required by the Companies (Auditorâs Report) Order, 2016 (âthe Orderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
14. 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), Statement of changes in equity and Cash Flow Statement dealt with by this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid financial statements comply with the India 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, 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.
(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, 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 financial statements - Refer Note 39 to the financial statements;
ii. The Company has long-term contracts as at March 31, 2019 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2019.
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2019.
ANNEXURE A TO INDEPENDENT AUDITORSâ REPORT
Referred to in paragraph 14(f) of the Independent Auditorsâ Report of even date to the members of SKF India Limited on the financial statements for the year ended March 31, 2019
Report on the Internal Financial Controls with reference to financial statements under Clause (i) of Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls with reference to financial statements of SKF India Limited (âthe Companyâ) as of March 31, 2019 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. The Companyâs management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Companyâs internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of internal financial controls with reference to financial statements, 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.
5. 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 with reference to financial statements.
Meaning of Internal Financial Controls with reference to financial statements
6. A companyâs internal financial controls with reference to financial statements 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 controls with reference to financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Companyâs assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls with reference to financial statements
7. Because of the inherent limitations of internal financial controls with reference to financial statements, 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 with reference to financial statements to future periods are subject to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system with reference to financial statements and such internal financial controls with reference to financial statements 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 B TO INDEPENDENT AUDITORSâ REPORT
Referred to in paragraph 13 of the Independent Auditorsâ Report of even date to the members of SKF India Limited on the financial statements as of and for the year ended March 31, 2019
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 3 years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.
(c) The title deeds of immovable properties, as disclosed in Note 3 and 4 on fixed assets to the financial statements, are held in the name of the Company.
ii. The physical verification of inventory have been conducted at reasonable intervals by the management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. The Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under Section 185 and 186. Therefore, the provisions of Clause 3(iv) of the said Order are not applicable to the Company.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employeesâ state insurance, income tax, duty of customs, cess, goods and service tax and other material statutory dues, as applicable, with the appropriate authorities. Also refer note 39 to the financial statements regarding managementâs assessment on certain matters relating to provident fund.
(b) According to the information and explanations given to us and the records of the Company examined by us, there are no dues of duties of customs, service tax and goods and service tax which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, duty of excise duty and value added taxes as at March 31, 2019 which have not been deposited on account of a dispute, are as follows:
Name of the statute |
Nature of dues |
Amount (Rs. in millions) |
Amount Paid under protest (Rs. in millions) |
Period to which the amount relates |
Forum where the dispute is pending |
Central Excise Act, 1944 |
Excise Duty (including interest and penalty if applicable) |
201.7 |
30.1 |
Various Years |
Customs Excise and Service Tax Appellate Tribunal (CESTAT) |
Income Tax Act, 1961 |
Income Tax (including interest and penalty if applicable) |
11.3 329.3 1,314.7 |
9.1 136.7 313.3 |
FY 2001-02, FY 2003-2004 and FY 2004-2005 Various Years Various Years |
High Court Commissioner of Income Tax (CIT) Appeals Income Tax Appellate Tribunal (ITAT) |
Central and Local Sales Tax Acts |
Sales Tax (including interest and penalty if applicable) |
45.1 10.3 160.4 23.6 |
3.7 11.7 24.1 0.3 |
FY 2007-08 to FY 2011-12 FY 2006-07 to FY 2014-15 FY 2010-11 to FY 2014-15 FY 2005-06 to FY 2013-14 |
Appellate Revision Board Appellate Tribunal Joint/Deputy Commissioner (Appeal) Objection Authority Department of Trade & Taxes, New Delhi |
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 as at the balance sheet date. The Company has not issued debentures as at balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures specified under Section 133 of the Act.
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 & Co Bangalore LLP
Firm Registration Number: 007567S/S-200012
Chartered Accountants
Jeetendra Mirchandani
Place: Bengaluru Partner
Date: May 15, 2019 Membership Number: 48125
Mar 31, 2018
INDEPENDENT AUDITORS'' REPORT To The Members of SKF India Limited
Report on the Indian Accounting Standards (Ind AS)
Financial Statements
1. We have audited the accompanying financial statements of SKF India Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, 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.
Management''s Responsibility for the Ind AS Financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these 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 Ind AS 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 ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made there under including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
5. We conducted our audit of the 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 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 ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error, in making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the 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 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 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, 2018, and its profit (including other comprehensive income), its cash flows and the changes in equity 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 subsection (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.
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) I n 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 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, 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 with reference to financial statements 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, 2018 on its financial position in its Ind AS financial statements - Refer Note [39];
ii. The Company has long-term contracts as at March 31, 2018 for which there were no material foreseeable losses.
The Company did not have any derivative contracts as at March 31, 2018.
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, 2018.
iv. The reporting on disclosures relating to Specified Bank Notes is not applicable to the Company for the year ended March 31, 2018.
Referred to in paragraph 10(f) of the independent Auditors'' Report of even date to the members of SKF India Limited on the financial statements for the year ended March 31, 2018.
Report on the Internal Financial Controls under Clause (i) of
Sub-section 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of SKF India Limited (âthe Companyâ) as of March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Management''s Responsibility for Internal Financial Controls
2. The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of internal Financial Controls Over Financial Reporting issued by the institute of Chartered Accountants of India (iCAi). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditors'' Responsibility
3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial
Reporting
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. i n our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, 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.
Referred to in paragraph 9 of the independent Auditors'' Report of even date to the members of SKF India Limited on the financial statements as of and for the year ended March 31, 2018
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 3 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 fixed assets to the financial statements, are held in the name of the Company.
ii. The physical verification of inventory have been conducted at reasonable intervals by the management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. The Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under Section 185 and 186.
Referred to in paragraph 9 of the Independent Auditors'' Report of even date to the members of SKF India Limited on the financial statements for the year ended March 31, 2018
Name of the statute |
Nature of dues |
Amount (INR in Million) |
Amount Paid under protest (INR in million) |
Period to which the amount relates |
Forum where the dispute is pending |
Central Excise |
Excise Duty (including |
1995 |
93 |
Various Years |
CESTAT |
Act, 1944 |
interest and penalty if applicable) |
28.1 |
1.3 |
Various Years |
Commissioner (Appeals) |
Finance Act, 1994 |
Service Tax (including interest 6.6 and penalty if applicable) |
0 7 |
various Years |
CESTAT |
|
income Tax Act, 1961 |
income Tax (including interest 11.3 and penalty if applicable) |
91 |
Various Years |
High Court |
|
18.3 |
nil |
Various Years |
CiT Appeals |
||
4.4 |
nil |
FY 2007-2008 |
Assessing Officer |
||
320 .5 |
885 |
FY 2010-2011 |
Assessing Officer/Transfer Pricing Officer |
Therefore, the provisions of Clause 3(iv) of the said Order are not applicable to the Company.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to
us and the records of the Company examined by us, in our opinion, the Company is regular in depositing the undisputed statutory dues, including provident fund, employees'' state insurance, income tax, sales tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and service tax with effect from July 1, 2017 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 duties of customs and goods and service tax which have not been deposited on account of any dispute. The particulars of dues of income tax, sales tax, service tax, duty of excise duty, and value added tax as at March 31, 2018 which have not been deposited on account of a dispute, are as follows:
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 as at the balance sheet date. The Company has not issued debentures as at balance sheet date.
Name of the statute |
Nature of dues |
Amount (INR in Million) |
Amount Paid under protest (INR in million) |
Period to which the amount relates |
Forum where the dispute is pending |
699 5 |
178.7 |
Various Years |
income Tax Appellate Tribunal (iTAT) |
||
Central and Local Sales Tax Acts |
Sales Tax (including interest and penalty if applicable) |
26.9 |
1.0 |
FY 2011-12 to FY 2014-15 |
Appellate Deputy Commissioner (CT) Appeal |
430 |
37 |
FY 2007-08 to FY 2011-12 |
Appellate Revision Board |
||
1.9 |
1.3 |
FY 2007-08 to FY 2013-14 |
Appellate Deputy Commissioner |
||
199 |
nil |
FY 2011-12 & FY 2012-13 |
Deputy Commissioner Appeal |
||
39 |
1.5 |
FY 2010-11 & FY 2012-13 |
Joint Commissioner (Appeal) |
||
97 |
09 |
FY 2013-14 & FY 2014-15 |
Joint / Additional Commissioner Appeal |
||
20 |
03 |
FY 2005-06 to FY 2012-13 |
Objection Authority Department of Trade & Taxes, New Delhi |
||
457 |
20 |
FY 2006-07 to FY 2013-14 |
Tribunal |
ix. The Company has not raised any moneys by way of initial public offer further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid / provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under India Accounting Standard (iND AS) 24, Related Party Disclosures specified under Section 133 of the Act, Companies (Indian Accounting Standard) 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 & Co Bangalore LLP
Firm Registration Number: 007567S/S-200012
Chartered Accountants
Pune Jeetendra Mirchandani
May 8, 2018 Partner
Membership Number 48125
Mar 31, 2017
TO THE MEMBERS OF SKF INDIA LIMITED Report on the Indian Accounting Standards (Ind AS) Financial Statements
1. We have audited the accompanying financial statements of SKF India 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 Ind AS Financial Statements
2. The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these 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 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 Ind AS financial statements based on our audit.
4. We have taken into account the provisions of the Act and the Rules made there under including the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
5. We conducted our audit of the 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 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 Ind AS financial statements. The procedures selected depend on the auditors'' judgment, including the assessment of the risks of material misstatement of the Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Ind AS financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the 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 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 fifteen months ended March 31, 2016 and the transition date opening balance sheet as at January 1, 2015 included in these Ind AS financial statements, are based on the previously issued statutory financial statements for the fifteen months ended March 31, 2016 and for the year ended December 31, 2014 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 10, 2016 and February 18, 2015 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the Company on transition to the Ind AS have been audited by us.
Our opinion is not qualified in respect of this matters.
10. As required by the Companies (Auditor''s Report) Order, 2016 issued by the Central Government of India in terms of subsection (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 Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in Annexure A.
(g) With respect to the other matters to be included in the Auditors''
Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014 in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
i) The Company has disclosed the impact, if any, of pending litigations as at March 31, 2017 on its financial position in its standalone Ind AS financial statements -Refer Note [38];
ii.) The Company has long-term contracts as at March 31, 2017 for which there were no material foreseeable losses. The Company did not have any derivative contracts as at March 31, 2017.
iii.) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company during the year ended March 31, 2017.
iv.) The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Management
Referred to in paragraph 11(f) of the Independent Auditors'' Report of even date to the members of SKF India Limited on the financial statements for the year ended March 31, 2017
Report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 of the Act
1. We have audited the internal financial controls over financial reporting of SKF India Limited (âthe Companyâ) as of March 31, 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.
Managementâs Responsibility for Internal Financial Controls
2. The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.
Auditorsâ Responsibility
3. Our responsibility is to express an opinion on the Company''s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing deemed to be prescribed under section 143(10) of the Act to the extent applicable to an audit of internal financial controls, both applicable to an audit of internal financial controls and both issued by the ICAI. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
6. A company''s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company''s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls Over Financial
Reporting
7. Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
8. In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
Referred to in paragraph 10 of the Independent Auditors'' Report of even date to the members of SKF India Limited on the 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 3 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 fixed assets to the financial statements, are held in the name of the Company.
ii. The physical verification of inventory have been conducted at reasonable intervals by the Management during the year. The discrepancies noticed on physical verification of inventory as compared to book records were not material.
iii. The Company has not granted any loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Act. Therefore, the provisions of Clause 3(iii), (iii)(a), (iii)(b) and (iii)(c) of the said Order are not applicable to the Company.
iv. The Company has not granted any loans or made any investments, or provided any guarantees or security to the parties covered under Section 185 and 186. Therefore, the provisions of Clause 3(iv) of the said Order are not applicable to the Company.
v. The Company has not accepted any deposits from the public within the meaning of Sections 73, 74, 75 and 76 of the Act and the Rules framed there under to the extent notified.
vi. Pursuant to the rules made by the Central Government of India, the Company is required to maintain cost records as specified under Section 148(1) of the Act in respect of its products. We have broadly reviewed the same, and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.
vii. (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing undisputed statutory dues in respect of TDS 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, income tax, , service tax, duty of customs, duty of excise, sales tax and VAT, 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, the particulars of dues of income tax, sales tax, service tax and duty of excise duty, value added tax 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 |
Amount paid |
Period to which |
Forum where the dispute |
(Rs, in Millions) |
under protest (Rs, in Millions) |
the amount relates |
is pending |
||
Central Excise Act, |
Excise Duty (including |
187.8 |
8.5 |
Various Years |
CESTAT |
1944 |
interest and penalty if applicable) |
31 |
0.7 |
Various Years |
Commissioner (Appeals) |
Finance Act, 1994 |
Service Tax (including interest and penalty if applicable) |
6.6 |
0.7 |
Various Years |
CESTAT |
Income Tax Act, 1961 |
Income Tax (including interest and penalty if |
353.9 |
119.7 |
Various Years |
Income Tax Apellate Tribunal (ITAT) |
applicable) |
320.5 |
88.5 |
FY 2010-2011 |
Assessing Officer/ Transfer Pricing Officer |
|
18.3 |
NIL |
FY 2007 - 2008, FY2008 - 2009 |
Commissioner of Income Tax - Appeals |
||
11.3 |
9.1 |
Various Years |
High Court |
||
7.1 |
NIL |
FY 2002 - 2003 |
Assessing Officer |
Central and Local Sales Tax Acts |
Sales Tax (including interest and penalty if applicable) |
20.0 |
0.3 |
FY 2005 - 2006 to FY 2012 -2013 |
Objection Authority Department of Trade & Taxes - Delhi |
48.8 |
4.2 |
FY 2007-2008 to FY 2012-2013 |
Appellate Revision Board -West Bengal |
||
15.3 |
5.9 |
Various Years |
Joint Commissioner, (Appeal) - Various States |
||
19.9 |
- |
FY 2011 - 2012 to FY 2012-2013 |
Deputy Commissioner, (Appeal) - Jamshedpur |
||
40.7 |
13.1 |
Various Years |
Tribunal - Bangalore |
||
3.6 |
1.5 |
Various Years |
Appellate Deputy Commissioner |
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 as at the balance sheet date. The Company had not issued any debentures as at balance sheet date.
ix. The Company has not raised any moneys by way of initial public offer, further public offer (including debt instruments) and term loans. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company.
x. During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the Company or on the Company by its officers or employees, noticed or reported during the year, nor have we been informed of any such case by the Management.
xi. The Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of
Section 197 read with Schedule V to the Act.
xii. As the Company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provisions of Clause 3(xii) of the Order are not applicable to the Company.
xiii. The Company has entered into transactions with related parties in compliance with the provisions of Sections 177 and 188 of the Act. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (IND AS) 24, Related Party Disclosures specified under Section 133 of the Act, Companies (Indian Accounting Standard) 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 & Co Bangalore LLP
Firm Registration Number: 007567S/S-200012
Chartered Accountants
Jeetendra Mirchandani Partner
Membership Number 48125
Place: Pune
May 26, 2017
Dec 31, 2014
1. We have audited the accompanying financial statements of SKF India
Limited (the "Company"), which comprise the Balance Sheet as at
December 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 December 31, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on Other Legal and Regulatory Requirements
7. As required by ''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 December 31, 2014, and taken on record by the Board of Directors,
none of the directors is disqualified as on December 31, 2014, from
being appointed as a director in terms of clause (g) of sub- section
(1) of section 274 of the Act.
Annexure to Independent Auditors'' Report Referred to in paragraph 7
of the Independent Auditors'' Report of even date to the members of
SKF India Limited on the financial statements as of and for the year
ended December 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 3 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 has been physically verified by the
Management during the year. In our opinion, the frequency of
verification is reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
iii. The Company has not granted/taken any loans, secured or unsecured,
to companies, firms or other parties covered in the register maintained
under Section 301 of the Act. Therefore, the provisions of Clause
4(iii)[(b),(c) and (d)/(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 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 TDS, Service Tax, VAT 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, 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, the particulars of dues of
income tax, sales tax, wealth tax, service tax, customs duty and excise
duty as at December 31, 2014 which have not been deposited on account
of a dispute, are as follows:
Name of the Statute Nature of Amount Amount paid
Dues (INR Million) under protes
(INR Million)
Central Excise Act,1944 Excise Duty 142.20 21.50
Central Excise Act,1944 Excise Duty 7.1 -
Finance Act, 1994 Service Tax 5.34 0.5
Finance Act, 1994 Service Tax 2.42 -
Income Tax Act, 1961 Income Tax 39.98 37.77
Income Tax Act, 1961 Income Tax 7.14 -
West Bengal Value Added Value Added
Tax & 25.3 2.63
Tax 2003 & The Central Central Sales Tax
Sales Tax Act, 1956 -
West Bengal
West Bengal Value Added Value Added Tax & 2.4 -
Tax 2003 & The Central Central Sales Tax
Sales Tax Act, 1956 -
West Bengal
West Bengal Value Added Value Added Tax & 32.1 -
Tax 2003 & The Central Central Sales Tax
Sales Tax Act, 1956 -
West Bengal
The Central Sales Tax
Act, Central Sales Tax 17.1 -
1956 - Delhi
The Central
Sales Tax Act, Central Sales Tax 1.2 1.87
1956 - Tamil Nadu
Karnataka Value Added
Tax Value Added Tax & 0.34 0.34
2003 & The Central
Sales Central Sales Tax
Tax Act, 1956 -
Karnataka
Karnataka Value Added
Tax Value Added Tax & 2.7 2.7
2003 & The Central
Sales Central Sales Tax
Tax Act, 1956 -
Karnataka
Karnataka Value Added
Tax Value Added Tax & 38.1 6.74
2003 & The Central
Sales Central Sales Tax
Tax Act, 1956 -
Karnataka
The Central Sales Tax
Act, Central Sales Tax 1.8 -
1956 - Maharashtra
Total 325.22 74.05
Name of the Statute Period to Forum where the
which the dispute is pending
amount relates
Central Excise Act, 1944 April 2006 to CESTAT, Mumbai
March 2012,
February 2005
Central Excise Act, 1944 Financial Years CESTAT, Bangalore
1999-2000,
September 2009
to June 2011
Finance Act, 1994 Financial Years CESTAT, Mumbai
July 2009 to
March 2012
Finance Act, 1994 April 2011 to Commissioner (Appeals),
September 2012 Pune
Income Tax Act, 1961 Financial Years Income Tax
1999-2000, 2001-2002, Appellate Tribunal
2003-2004, 2004-2005,
2006-2007, 2007-2008,
2008- 2009
Income Tax Act, 1961 Financial Year
2002-2003 Assessing Officer
West Bengal Value Added
Tax 2003 & The Central
Sales Tax Act, 1956 -
West Bengal Financial Years
2007-2008, Senior Joint
2010-2011, 2011-2012 Commissioner
Commercial Tax
West Bengal Value Added
Tax 2003 & The Central
Sales Tax Act, 1956 -
West Bengal Financial Year 2006
- 2007 Additional
Commissioner
Commercial Tax
West Bengal Value Added
Tax 2003 & The Central
Sales Tax Act, 1956 -
West Bengal Financial Years 2008
- 2009, Revision Board
2009 - 2010
The Central Sales Tax Act,
1956 - Delhi Financial Years
2005-2006, Objection Authority
2006-2007, 2007-2008, Department of
2008-2009, 2009-2010, Trade & Taxes,
2010- 2011 New Delhi
The Central Sales Tax Act,
1956 - Tamil Nadu Financial Year Commercial Tax
2005 - 2006 Officer
Karnataka Value Added Tax
2003 & The Central Sales
Tax Act, 1956 - Karnataka Financial Year
2003-2004 Deputy
Commissioner
Karnataka Value Added Tax
2003 & The Central Sales
Tax Act, 1956 - Karnataka Financial Years
2007-2008, Tribunal
2009- 2010.
Karnataka Value Added Tax
2003 & The Central Sales
Tax Act, 1956 - Karnataka Financial Years
2005-2006, Joint Commissioner
2006-2007, 2010-2011, (Appeals)
2011- 2012
The Central Sales Tax Act,
1956 - Maharashtra Financial Year
2010-2011 Joint Commissioner
(Appeals)
Total
x. The Company has no accumulated losses as at the end of the financial
year and it has not incurred any cash losses in the financial year
ended on that date or in the immediately preceding financial year.
xi. As the Company does not have any borrowings from any financial
institution or bank nor has it issued any debentures as at the balance
sheet date, the provisions of Clause 4(xi) of the Order are not
applicable to the Company.
xii. The Company has not granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
Therefore, the provisions of Clause 4(xii) of the Order are not
applicable to the Company.
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. The Company has not raised any term loans. Accordingly, the
provisions of Clause 4(xvi) of the Order are not applicable to the
Company.
xvii. The Company has not raised any funds on short term basis.
Accordingly, the provisions of Clause 4(xvii) of the Order are not
applicable to the Company.
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 not issued any debentures during the year and does
not have any debentures outstanding as at the beginning of the year and
at the year end. Accordingly, the provisions of Clause 4(xix) of the
Order are not applicable to the Company.
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 & Co Bangalore LLP
Firm Registration Number: 007567S/S-200012
Chartered Accountants
Jeetendra Mirchandani
Pune Partner
February 18, 2015 Membership Number: 48125
Dec 31, 2013
1. We have audited the accompanying financial statements of SKF India
Limited (the ''Company'') which comprise the Balance Sheet as at December
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 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'' judgement, 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 December, 31 2013;
(b) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Other Matter
7. The financial statements of the Company as at December 31, 2012 and
for the year then ended were audited by another firm of chartered
accountants who, vide their report dated February 21, 2013, expressed
an unmodified opinion on those financial statements.
Report on Other Legal and Regulatory Requirements
8. 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 & 5 of the Order.
9. 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 accounts as required by law have
been kept by the Company so for 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 December 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on December 31, 2013, from
being appointed as a director in terms of clause (g) of sub- section
(1) of section 274 of the Act.
Annexure to Independent Auditors'' Report
Referred to in paragraph 8 of the Independent Auditors'' Report of even
date to the members of SKF India Limited on the financial statements as
of and for the year ended December 31, 2013
(i) (a) The Company is maintaining proper records showing full
particulars, including quantitative details and situation, of fixed
assets.
(b) The fixed assets are physically verified by the Management
according to a phased program 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 program, 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 has been physically verified by the Management
during the year. In our opinion, the frequency of verification is
reasonable.
(b) In our opinion, the procedures of physical verification of
inventory followed by the Management are reasonable and adequate in
relation to the size of the Company and the nature of its business.
(c) On the basis of our examination of the inventory records, in our
opinion, the Company is maintaining proper records of inventory. The
discrepancies noticed on physical verification of inventory as compared
to book records were not material.
(iii) (a) The Company has not granted/ taken any loans, secured or
unsecured, to companies, firms or other parties covered in the register
maintained under Section 301 of the Act. Therefore, the provisions of
Clause 4(iii) [(b),
(c) and (d) / (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 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 TDS, service tax and VAT, 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, income tax,
wealth tax, customs duty, excise duty and other material statutory
dues, as applicable, with the appropriate authorities.
(b) According to the information and explanations given to us and the
records of the Company examined by us, the particulars of dues of
income tax, sales tax, service tax, and excise duty as at December 31,
2013 which have not been deposited on account of a dispute, are as
follows:
Referred to in paragraph 8 of the Independent Auditors'' Report of even
date to the members of SKF India Limited on the financial statements
for the year ended December 31, 2013
Name of the Statute Nature of Amount Amount paid
Dues (INR
Million) under protest
(INR Million)
Central Excise Excise Duty 146.97 21.50
Act, 1944
Central Excise Excise Duty 157.74 -
Act, 1944
Central Excise Excise Duty 10.06 -
Act, 1944
Central Excise Excise Duty 0.32 -
Act, 1944
Finance Act, 1994 Service Tax 115.96 0.50
Finance Act, 1994 Service Tax 1.02 -
West Bengal Value Value Added Tax 101.48 2.63
Added Tax 2003 & & Central
Sales Tax
The Central Sales Tax
Act 1956 - West Bengal
West Bengal Value Value Added
Tax & 2.40 -
Added Tax 2003 & Central Sales
Tax
The Central Sales Tax
Act 1956 - West Bengal
Haryana State Value Value Added
Tax & 0.67 -
Added Tax, 2003 Central Sales
Tax
& The Central Sales
Tax Act, 1956 - Haryana
Jharkhand Value Value Added Tax 6.12 -
Tax Act, 2005
The Central Sales Tax Central Sales
Tax 17.07 -
Act, 1956- Delhi
The Central Sales Tax Central Sales
Tax 1.25 1.87
Act, 1956- Tamil Nadu
Karnataka Value Value Added
Tax & 8.48 8.48
Added Tax 2003 & Central Sales
Tax
The Central Sales
Tax Act, 1956- Karnataka
Income Tax Income Tax 34.13 24.77
Act, 1962
Income Tax Act, 1962 Income Tax 12.99 12.99
Total 616.66 72.74
Name of the Status Period to Forum where the
which the dispute is pending
amount relates
Central Excise October 1994 to CESTAT, Mumbai
January 1995,
Act, 1944 February 2005,
January 2007 to
March 2011
Central Excise FY 1999-2000, CESTAT, Bangalore
January 2007 to
March 2011
Act, 1944
Central Excise FY 1997-1998, Commissioner
Act, 1944 September 2009
to (Appeals) -
June 2011 Bangalore
Central Excise April 2010 to Commissioner
Act, 1944 March 2012 (Appeals) - Pune
Finance Act, 1994 FY 2006 -07 CESTAT
to FY 2010-11
Finance Act, 1994 FY 2011-2012, Commissioner
April 2012 to (Appeals)
September 2012
West Bengal Value FY 2007-08 to Senior Joint
Added Tax 2003 &
The Central Sales Tax
Act 1956 - West Bengal FY 2010-11 Commissioner,
Commercial Tax
West Bengal Value FY 2006-07 Additional
Added Tax 2003 & The Central
Sales Tax Act 1956 -
West Bengal Commissioner,
Commercial Tax
Haryana State Value FY 2009-10 Commercial Tax
Added Tax, 2003 & The
Central Sales Tax Act,
1956 - Haryana Officer
Jharkhand Value FY 2009-10 Joint Commissioner
Commercial Tax
Tax Act, 2005
The Central Sales Tax FY 2005-06 to Commissioner
Act, 1956- Delhi FY 2010-11 (Appeals)
The Central Sales Tax FY 2005-06 Commercial Tax
Act, 1956- Tamil Nadu Officer
Karnataka Value FY 2003-04, Deputy
Added Tax 2003 & The
Central Sales
Tax Act, 1956- Karnataka FY 2005-06 to Commissioner
FY 2007-08 FY 2009-10
Income Tax FY 1999-2000 ITAT
Act, 1962 FY 2001-02 to
FY 2004-05,
FY 2006-07
Income Tax Act, 1962 FY 2007-08, Commissioner of
FY 2008-09 Income Tax
(Appeals)
(x) The Company has no accumulated losses as at the end of the
financial year and it has not incurred any cash losses in the financial
year ended on that date or in the immediately preceding financial year.
(xi) As the Company does not have any borrowings from any financial
institution or bank nor has it issued any debentures as at the balance
sheet date, the provisions of Clause 4(xi) of the Order are not
applicable to the Company.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities. Therefore, the provisions of Clause 4(xii) of the Order are
not applicable to the Company.
(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) The Company has not raised any term loans. Accordingly, the
provisions of Clause 4(xvi) of the Order are not applicable to the
Company.
(xvii) The Company has not raised any loans on short term basis.
Accordingly, the provisions of Clause 4(xvii) of the Order are not
applicable to the Company.
(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 not issued any debentures during the year and
does not have any debentures outstanding as at the beginning of the
year and at the year end. Accordingly, the provisions of Clause 4(xix)
of the Order are not applicable to the Company.
(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
fraud on or by the Company, noticed or reported during the year, nor
have we been informed of any such case by the Management.
For Price Waterhouse & Co., Bangalore
Firm Registration No.007567S
Chartered Accountants
Jeetendra Mirchandani
Pune Partner
February 21. 2014 Membership Number: 48125
Dec 31, 2012
1. We have audited the attached Balance Sheet of SKF India Limited
(''the Company'') as at 31 December 2012, the Statement of Profit and
Loss and the Cash Flow Statement of the Company for the year ended on
that date, annexed thereto. 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 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 issued
by the Central Government of India in terms of sub-section (4A) of
section 227 of the Companies Act, 1956, we enclose 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 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 the 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
the Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956;
(e) on the basis of written representations received from the directors
of the Company as at 31 December 2012 and taken on record by the Board
of Directors, we report that none of the directors is disqualified as
at 31 December 2012 from being appointed as a director under clause (g)
of sub-section (1) of section 274 of the Companies Act 1956; and
(f) in our opinion, and to the best of our information and according to
the explanations given to us, the said financial statements, read with
the notes thereon, 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:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 December 2012;
(ii) in the case of the Statement of Profit and Loss, of the profit for
the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure to the Auditors'' Report
(Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which all fixed assets are verified in a phased manner
over a period of three years. In our opinion, this periodicity of
physical verification is reasonable having regard to the size of the
Company and the nature of its assets. The discrepancies noticed on
verification between the physical fixed assets and the book records
were not material and were properly dealt in the books of account.
(c) Fixed assets disposed off during the year were not substantial, and
therefore, do not affect the going concern assumption.
(ii) (a) The inventory, except goods-in-transit, has been physically
verified by the management during the year. In our opinion, the
frequency of such verification is reasonable.
(b) The procedures for the physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material and were properly dealt with in the
books of accounts.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
certain items of inventories and fixed assets are for the Company''s
specialised requirements and similarly certain goods sold and services
rendered are for the specialised requirements of the buyers and
suitable alternative sources are not available to obtain comparable
quotations, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. In our opinion and according to the information
and explanations given to us, there is no continuing failure to correct
major weaknesses in internal control system.
(v) (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 Companies Act, 1956 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 contracts and
arrangements referred to in (a) above and exceeding the value of Rs. 5
lakh with any party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time, except for purchases of certain items of inventories and
fixed assets which are for the Company''s specialised requirements and
similarly for sale of certain goods and rendering of services which are
for the specialised requirements of the buyers and for which suitable
alternative sources are not available to obtain comparable quotations.
However, on the basis of information and explanations provided, the
same appear reasonable.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system
commensurate with its size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under section 209(1) (d) of the Companies
Act, 1956 in respect of manufacture of bearings and are of the opinion
that prima facie, the prescribed accounts and records have been made
and maintained. However, we have not made a detailed examination of the
records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employees'' State Insurance,
Income tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise
duty, Investor Education and Protection Fund and other material
statutory dues have generally been regularly deposited during the year
by the Company with the appropriate authorities.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees''
State Insurance, Income tax, Sales tax, Wealth tax, Service tax,
Customs duty, Excise duty, Investor Education and Protection Fund and
other material statutory dues were in arrears as at 31 December 2012
for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, the
following dues of Income-tax, Sales tax, Wealth tax, Service tax,
Customs duty and Excise duty (as appropriate) have not been deposited
by the Company on account of disputes:
Sr.
No. Name of the Statute Nature of the Amount
Dues (Rs. Million)
1 Income Tax Act, 1961 Income Tax 13.4
2 Income Tax Act, 1961 Income Tax 14.8
Name of the Statute Amount
paid Period to Forum where
under
protest which the dispute is pending
(Rs.
Million) amount relates
Income Tax Act,1961 13.4 AY 2005 Â 2006, & ITAT
2007 Â 2008
Income Tax Act, 1961 7.6 AY 2002 Â 03, CIT (Appeals)
2004 Â 05 &
2008-2009
Sr.
No. Name of the Statute Nature of the Amount
Dues (Rs. Million)
3 Karnataka Value Central 8.0
Added Ta x Act  CST Sales Tax
(The Central Sales Tax
Act, 1956 Â Karnataka)
4 The Central Sales Central 0.3
Tax Act, 1956 Â Sales Tax
Karnataka
5 Maharashtra Sales Sales Tax 1.7
Tax Act, 1958
6 The Central Sales Central 14.4
Tax Act, 1956 Â Sales Tax
Delhi
7 West Bengal Value Value Added 95.8
Added Tax 2003 & Tax &
The Central Sales Central Sales
Tax Act, 1956 Tax Act
8 Central Excise Act, Excise Duty 147.0
1944
9 Central Excise Act, Excise Duty 155.0
1944
10 Central Excise Act, Excise Duty 1.6
1944
11 Central Excise Act, Excise Duty 2.7
1944
12 Finance Act, 1994 Excise Duty 1.0
13 Finance Act, 1994 Service Tax 2.6
14 Finance Act, 1994 Service Tax 0.7
15 Finance Act, 1994 Service Tax 107.8
16 Finance Act, 1994 Service Tax 7.1
Name of the Statute Amount
paid Period to Forum where
under
protest which the dispute is pending
(Rs.
Million) amount relates
Karnataka Value Added
Tax Act 8.0 F.Y 2005 Â 06, Joint Commissioner
F.Y 2006 Â 07
F.Y 2007 Â 08
F.Y 2008 Â 09
F.Y 2009 - 10
The Central Sales Tax
Act, 1956 0.3 FY 2003-2004 Assessing Authority
Maharashtra Sales
Tax Act, 1958 0.6 FY 2002 Â 2003 Maharashtra Sales
Tax Tribunal
The Central Sales
Ta Act, 1956 - FY 2005 - 06 Objection authority
FY 2006 Â 07 Department of
FY 2007 - 08 Trade & taxes
West Bengal Value
Added Tax 2003 2.6 FY 2006 - 07 Senior Joint
FY 2007 Â 08 Commissioner,
FY 2008 Â 09 Sales Tax
FY 2009 - 10
Central Excise Act, 1944 20.0 FY 1994-95, CESTAT, Mumbai
FY 2006 -07 to
January 2011,
January 2009 to
December 2009,
February 2005,
February 2011 to
March 2011.
Central Excise Act, 1944 - January 2007- Appeal to be filed
March 2011 with CESTAT
Bangalore
Central Excise Act, 1944 - 1997-98 & Commissioner
1998 - 99 Appeals Bangalore
Central Excise Act, 1944 - 1999-2000 CESTAT, Bangalore
Finance Act, 1994 - 2007 Â 2009 Appeal to be filed
with CESTAT Mumbai
Finance Act, 1994 1.3 1997-2000 CESTAT, Mumbai
Finance Act, 1994 0.3 2002 Â 2005 Commissioner
Appeals, Mumbai
Finance Act, 1994 - April 2006 to CESTAT, Mumbai
May 2008
Finance Act, 1994 - January 2009 to Commissioner
March 2011 Appeals, Pune
(x) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) The Company did not have any outstanding dues to any financial
institution, banks or debenture holders during the year.
(xii) The Company has not granted any loans or advances on the basis of
security by way of pledge of shares, debentures and other securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of the Company, we are of
the opinion that the funds raised on short-term basis have not been
used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/firms/other parties covered in the register maintained
under Section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For B S R & Associates
Chartered Accountants
Firm Registration No.-116231W
Shiraz Vastani
Pune Partner
21 February 2013 Membership No: 103334
Dec 31, 2010
1. We have audited the attached Balance Sheet of SKF India Limied
(the Company) as a 31 December 2010, the Profit and Loss Account and
the Cash Row Statement of the Company for the year ended on that date,
annexed hereto. These financial statements are the responsibiliy 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 auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial staements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporing the amouns and
disclosures in the financial saemens. 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 (Audiors Repor) Order 2003 issued by
the Central Government of India in terms of sub-secion (4A) of section
227 of the Companies Ac, 1956, we enclose 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 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 the Cash Flow
Statement deal with by this report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and the
Cash Flow Statement deal with by his report comply wih the accounting
standards referred to in sub-secion (3C) of section 211 of the
Companies Act, 1956;
(e) on the basis of written representations received from the Directors
of the Company as a 31 December 2010 and taken on record by the Board
of Directors, we report that none of the Directors are disqualified as
at 31 December 2010 from being appointed as a Director under clause (g)
of sub-section (1) of section 274 of the Companies Act 1956; and
(f) in our opinion, and to the best of our information and according to
the explanations given to us, the said financial statements, read with
the notes hereon, give the information required by the Act, in the
manner so required and give a true and fair view in conformiy wih the
accounting principles generally acceped in India:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31 December 2010;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Annexure to the Auditors Report (Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which all fixed assets are verified in a phased manner
over a period of three years. In our opinion, his periodicity of
physical verification is reasonable having regard to the size of the
Company and the naure of is assets. The discrepancies noticed on
verification between the physical fixed assets and the book records
were not material and were properly dealt in the books of account.
(c) Fixed assets disposed of during the year were not substantial, and
herefore, do not affect the going concern assumption.
(ii) (a) The invenory, excep goods-in-ransi, has been physically
verified by the managemen during the year. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verifictaion of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were no material and were properly dealt with in the
books of accounts.
(iii) The Company has neiher granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
cerain items of inventories and fixed assets are for the Companys
specialised requirements and similarly certain goods sold and services
rendered are for the specialised requirements of the buyers and
suitable alternative sources are no available to obtain comparable
quotation, here is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchase of inventories and fixed assets and with regard to the sale
of goods and services. In our opinion and according to the information
and explanations given to us, here is no continuing failure to correct
major weaknesses in internal control system.
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or arrangements
referred to in secion 301 of the Companies Act, 1956 have been entered
in the register required to be mainained under that section.
(b) In our opinion, and according to the information and explanations
given to us, the transactions made in pursuance of contracts and
arrangements referred to in (a) above and exceeding the value of Rs 5
lakh with any party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time, except for purchases of certain items of inventories,
fixed assets and services which are for the Companys specialised
requirements and similarly for sale of certain goods and rendering of
services which are for the specialised requirements of the buyers and
for which suitable alernative sources are not available to obtain
comparable quotations. However on the basis of information and
explanations provided, the same appear reasonable.
(vi) In our opinion, and according to the information and explanations
given to us, the Company has complied wih the provisions of Section
58A, Section 58AA or other
relevant provisions of the Companies Act, 1956 and the rules framed
here under/the directives issued by the Reserve Bank of India (as
applicable) with regard to deposits accepted from the public.
Accordingly, here have been no proceedings before the Company Law Board
or National Company Law Tribunal (as applicable) or Reserve Bank of
India or any Court or any other Tribunal in his matter and no order has
been passed by any of the aforesaid authorities.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under secion 209(1) (d) of the Companies
Act, 1956 in respect of manufacture of bearings, and are of the opinion
that prima facie, the prescribed accounts and records have been made
and mainained. However, we have no made a detailed examination of the
records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examinaion of the records of the Company, amounts
deduced / accrued in the books of account in respect of undisputed
stautory dues including Provident Fund, Employees State Insurance,
Income tax, Sales tax, Wealh tax, Service tax, Cusoms duty, Excise
duty, Cess and other material stautory dues have generally been
regularly deposited during the year by the Company wih the appropriate
authorities. As explained to us, the Company did no have any dues on
account of Investor Education and Protection Fund.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, Employees
State Insurance, Income tax, Sales tax, Wealh tax, Service tax, Customs
duty, Excise duty, Cess and other material satutory dues were in
arrears as a 31 December 2010 for a period of more than six months from
the date they became payable.
There were no dues on account of cess under secion 441A of the
Companies Act, 1956 since the date from which the aforesaid section
comes into force has not yet been notified by the Central Government.
(b) According to the information and explanations given to us, the
following dues of Incometax/Sales tax/ Wealth tax/Service tax/Customs
duty/Excise duty/ Cess (as appropriate) have no been deposied by the
Company on account of disputes:
Name of the Statute Nature of the Amount Period to Forum where
Dues (Rs.
Million) which the is pending
amount
relates
Income Tax Act,1961 Income Tax 5.1 AY 2006-2007 CIT(A)
Income Tax Act, 1961 Income Tax 9.3 AY 2007-2008 CIT(A)
Tamil Nadu Value
Added Tax Act Value Added Tax 1.2 2005 - 2006 Commercial
tax officer
Maharashtra Sales
Tax Act, 1958 Sales Tax 1.1 2002 - 2003 Maharashtra
Sales Tax
Tribunal
Delhi Sales Tax Act Sales Tax 1.3 2005-2006 Objection
Authority
Deparment
of Trade
& Taxes,
New Delhi
West Bengal
Sales Tax Act Sales Tax 2.4 2006-2007 Commissi
oner
(Appeals)
Karnataka Sales
Tax Sales Tax 0.3* 2003-2004 Karnataka
Appellate
Tribunal
Karnataka Value
Added Tax Central Sales Tax 1.2* 2005-2006 Commissi
oner
Appeals
Karnataka Sales
Tax Sales Tax 2.7* 2006-2007 Commissi
oner
Appeals
Karnataka Sales
Tax Sales Tax 1.3* 2008-2009 Commissi
oner
Appeals
Karnataka Value
Added Tax VAT 1.4* 2006-2007 Joint
Commissi
oner of
Commercial
Taxes
(Appeals)
Central Excise
Act, 1944 Excise Duty 2.6 1999-2000 CESTAT
Central Excise
Act, 1944 Excise Duty 1.6 1997-1998 CESTAT
Central Excise
Act, 1944 Excise Duty 4.9* 1995 CESTAT
Finance Act,
1994 Service tax 1.3 1997-2000 CESTAT
Finance Act,
1994 Service Tax 14.3 2006-2008 CESTAT
Finance Act,
1994 Service Tax 0.1 2008-2009 CESTAT
Finance Act,
1994 Service Tax 0.7 2005-2006 Commissi
oner
Appeals
* Amount paid under protest
(x) The Company does nto have any accumulated losses at the end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) The Company did not have any outstanding dues to any financial
institution, banks or debenture holders during the year.
(xii) The Company has no granted any loans and advances on the basis of
security by way of pledge of shares, debenures and other securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the Balance Sheet of
the Company, we are of the opinion that the funds raised on shorterm
basis have no been used for longterm investment.
(xviii) The Company has no made any preferential allotment of shares to
companies/firms/parties coverted in the register maintained under
Section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For B S R & Associates
Chartered Accountants
Firm Regn. No.-116231W
Bhavesh Dhupelia
Parner
Membership No.: 042070
Pune
February 23, 201
Dec 31, 2009
1. We have audited the attached Balance Sheet of SKF India Limited
(Ãthe CompanyÃ) as at 31st December, 2009, the Profit and Loss Account
and the Cash Flow Statement of the Company for the year ended on that
date, annexed thereto. These financial statements are the
responsibility of the CompanyÃs management. Our responsibility is to
express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with 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 (AuditorÃs Report) Order, 2003 issued
by the Central Government of India in terms of sub-section (4A) of
section 227 of the Companies Act, 1956, we enclose 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 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 the 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 the
Cash Flow Statement dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of section 211 of
the Companies Act, 1956;
(e) on the basis of written representations received from the Directors
of the Company as at 31st December, 2009 and taken on record by the
Board of Directors, we report that none of the Directors are
disqualified as at 31st December, 2009 from being appointed as a
Director under clause (g) of sub-section (1) of section 274 of the
Companies Act, 1956; and
(f) in our opinion, and to the best of our information and according to
the explanations given to us, the said financial statements, read with
the notes thereon, 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:
(i) in the case of the Balance Sheet, of the state of affairs of the
Company as at 31st December, 2009;
(ii) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
ANNEXURE TO THE AUDITORSÃ REPORT
(Referred to in our report of even date)
(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its
fixed assets by which all fixed assets are verified in a phased manner
over a period of three years. In our opinion, this periodicity of
physical verification is reasonable having regard to the size of the
Company and the nature of its assets. The discrepancies noticed on
verification between the physical fixed assets and the book records
were not material and were properly dealt in the books of account.
(c) Fixed assets disposed of during the year were not substantial, and
therefore, do not affect the going concern assumption.
(ii) (a) The inventory, except goods-in-transit, has been physically
verified by the management during the year. In our opinion, the
frequency of such verification is reasonable. For stock lying with
certain third parties at the year end, written confirmations have been
obtained.
(b) The procedures for the physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. The
discrepancies noticed on verification between the physical stocks and
the book records were not material.
(iii) The Company has neither granted nor taken any loans, secured or
unsecured, to or from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
(iv) In our opinion and according to the information and explanations
given to us, and having regard to the explanation that purchases of
certain items of inventories and fixed assets are for the CompanyÃs
specialised requirements and similarly certain goods sold are for the
specialised requirements of the buyers and suitable alternative sources
are not available to obtain comparable quotation, there is an adequate
internal control system commensurate with the size of the Company and
the nature of its business with regard to purchase of inventories and
fixed assets and with regard to the sale of goods and services. In our
opinion and according to the information and explanations given to us,
there is no continuing failure to correct major weaknesses in internal
control system.
(v) (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 Companies Act, 1956 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 contracts and
arrangements referred to in (a) above and exceeding the value of Rs 5
lakh with any party during the year have been made at prices which are
reasonable having regard to the prevailing market prices at the
relevant time, except for purchases of certain items of inventories,
fixed assets and services which are for the CompanyÃs specialised
requirements and similarly for sale of certain goods for the
specialised requirements of the buyers and for which suitable
alternative sources are not available to obtain comparable quotations.
However, on the basis of information and explanations provided, the
same appear reasonable.
(vi) In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of Section
58A, Section 58AA or other relevant provisions of the Companies Act,
1956 and the rules framed thereunder/the directives issued by the
Reserve Bank of India (as applicable) with regard to deposits accepted
from the public. Accordingly, there have been no proceedings before the
Company Law Board or National Company Law Tribunal (as applicable) or
Reserve Bank of India or any Court or any other Tribunal in this matter
and no order has been passed by any of the aforesaid authorities.
(vii) In our opinion, the Company has an internal audit system
commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the
Company pursuant to the rules prescribed by the Central Government for
maintenance of cost records under section 209(1)(d) of the Companies
Act, 1956 in respect of manufacture of bearings, and are of the opinion
that prima facie, the prescribed accounts and records have been made
and maintained. However, we have not made a detailed examination of the
records.
(ix) (a) According to the information and explanations given to us and
on the basis of our examination of the records of the Company, amounts
deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Employeesà State Insurance,
Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise
Duty, Cess and other material statutory dues have generally been
regularly deposited during the year by the Company with the appropriate
authorities. As explained to us, the Company did not have any dues on
account of Investor Education and Protection Fund.
According to the information and explanations given to us, no
undisputed amounts payable in respect of Provident Fund, EmployeesÃ
State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax,
Customs Duty, Excise Duty, Cess and other material statutory dues were
in arrears as at 31st December, 2009 for a period of more than six
months from the date they became payable.
There were no dues on account of cess under section 441A of the
Companies Act, 1956 since the date from which the aforesaid section
comes into force has not yet been notified by the Central Government.
(b) According to the information and explanations given to us, the
following dues of Income-Tax/Sales Tax/ Wealth Tax/Service Tax/Customs
Duty/Excise Duty/ Cess (as appropriate) have not been deposited by the
Company on account of disputes:
Name of the Statute Nature of the Amount
Dues (Rs Millions)
Income Ta x Act, 1961 Income Tax 4.5
Jharkhand Sales Tax Sales Tax 23.7
Karnataka Sales Tax Act, 1957 Sales Tax 4.4
Karnataka Sales Ta x Act, 1957 Sales Tax 0.3
Karnataka Value Added Tax
Act, 2003 Central Sales Tax 3.1
Tamil Nadu Value Added
Tax Act Value Added Tax 1.2
Maharashtra Sales Tax
Act, 1958 Sales Tax 1.1
Karnataka Value Added Tax
Act, 2003 Central Sales Tax 1.2
Jharkand Sales Tax Act Sales Tax 6.3
Jharkand Sales Tax Act Sales Tax 7.0
Delhi Sales Ta x Act Sales Tax 1.3
West Bengal Sales Tax Act Sales Tax 2.4
Central Excise Act, 1944 Excise Duty 1.6
Central Excise Act, 1944 Excise Duty 2.6
Central Excise Act, 1944 Excise Duty 4.9
Finance Act, 1994 Service Tax 1.3
Karnataka Value Added Tax
Act, 2003 VAT 1.4
Name of the Statue Period to Forum where dispute is
which the pending
amount relates
Income Tax Act, 1961 A Y 2003 - 04 Commissioner of Income
Tax (Appeal).
Jharkhand Sales Tax 2003-04 Deputy Commissioner
Karnataka Sales Tax
Act, 1957 2002-03 High Court of Karnataka
Karnataka Sales Tax
Act, 1957 2003- 04 Karnataka Appellate Tribunal
Karnataka Value Added
Tax Act, 2003 2006-2007 Joint Commissioner of
Commercial Taxes (Appeals)
Tamil Nadu Value
Added Tax Act 2005- 06 Commercial Tax officer
Maharashtra Sales
Tax Act, 1958 2002- 03 Maharashtra Sales Tax
Tribunal
Karnataka Value Added
Tax Act, 2003 2005 - 2006 Joint Commissioner of
Commercial Taxes (Appeals)
Jharkand Sales Tax
Act 2004-2005 Deputy Commissioner
Jharkand Sales Tax
Act 2005-2006 Deputy Commissioner
Delhi Sales Tax Act 2005-2006 Objection Authority
Department of Trade & Taxes,
New Delhi
West Bengal Sales
Tax Act 2006-2007 Additional Commissioner of
Commercial Tax
Central Excise
Act, 1944 1997-1998 Commissioner of Central
Excise
Central Excise
Act, 1944 1999-2000 CESTAT
Central Excise Act,
1944 1995 CESTAT
Finance Act, 1994 1997-2000 CESTAT
Karnataka Value
Added Tax Act, 2003 2006-2007 Joint Commissioner of
Commercial Taxes (Appeals)
(x) The Company does not have any accumulated losses at the end of the
financial year and has not incurred cash losses in the financial year
and in the immediately preceding financial year.
(xi) The Company did not have any outstanding dues to any financial
institution, banks or debenture holders during the year.
(xii) The Company has not granted any loans and advances on the basis
of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations
given to us, the Company is not a chit fund or a nidhi/ mutual benefit
fund/ society.
(xiv) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the
year.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we are of
the opinion that the funds raised on short-term basis have not been
used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares
to companies/firms/parties covered in the register maintained under
Section 301 of the Companies Act, 1956.
(xix) The Company did not have any outstanding debentures during the
year.
(xx) The Company has not raised any money by public issues.
(xxi) According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during the
course of our audit.
For B S R & Associates
Chartered Accountants
Subramanian Vivek
Partner
Pune Membership No: 100322
19th February, 2010