Mar 31, 2023
Sun Pharma Advanced Research Company Limited Report on the Audit of the Financial Statements
We have audited the accompanying financial statements of Sun Pharma Advanced Research Company Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2023, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including 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 financial statements give the information required by the Companies Act, 2013, as amended (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, 2023, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs), as 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 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 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 audit opinion on the financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the financial year ended March 31, 2023. 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. For each key audit matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s responsibilities for the audit of the financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial statements.
Key audit matters |
How our audit addressed the key audit matter |
(a) Revenue recognition (as described in Note 27 of the financial statements) |
|
The Company is engaged in the business of Research and |
Our audit procedures amongst others included the following: |
Development of pharmaceutical products. The Company has various contractual arrangements with customers which are entered into at various stages of research and development. The Company, in line with Ind AS 115 |
⢠Read the accounting policy for revenue recognition of the Company and assessed compliance with the principles enunciated under Ind AS 115. |
recognises revenue based on the contractual terms and |
⢠Evaluated the design and tested the operating effectiveness of |
performance obligations with customers. Some of these |
management''s controls in respect of revenue recognition. |
arrangements involve judgments which may impact the |
⢠Obtained a sample of contracts and reviewed the terms of |
manner and timing of revenue recognition. |
the arrangements to determine whether the work performed |
Considering that contractual arrangements with customers |
under the contract qualified for revenue recognition having |
involve judgments which may impact the manner and |
regard to the performance obligations under the contracts. |
timing of revenue recognition, accordingly it is considered |
⢠Assessed the disclosures in the accompanying financial |
as a key audit matter. |
statements. |
Evaluation of direct tax and indirect tax litigations (as described in Note 42 of the financial statements) |
|
The Company has material direct tax and indirect tax |
Our audit procedures amongst others included the following: |
litigations which involve significant judgment to determine |
⢠Evaluated the design and tested the operating effectiveness |
the possible outcome of these disputes and accordingly it is considered as key audit matter. |
of controls in respect of the identification and evaluation of tax litigations and the recording and reassessment of the related liabilities and provisions and disclosures. ⢠Obtained list of ongoing tax litigations from management along with their assessment of the cases based on past precedents, judgements and matters in the jurisdiction, legal opinions sought by management, correspondences with tax department etc. ⢠Engaged tax specialists, to evaluate management''s assessment of the outcome of these litigations. Our specialists considered legal precedence and other rulings in evaluating management''s position on these tax litigations. ⢠Assessed contingent liability disclosure in the accompanying financial statements. |
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 Report, Business Responsibility and Sustainability Report and Board''s Report, but does not include the financial statements and our auditor''s report thereon. The Management Discussion and Analysis Report, Business Responsibility and Sustainability Report and Board''s Report is expected to be made available to us after the date of this auditor''s report.
Our opinion on the financial statements does not cover the other information and we will 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 identified above
when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated
Responsibilities of Management for the 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 financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015,
as amended. 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 the 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.
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
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.
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 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.
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 financial statements for the financial year ended March 31, 2023 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order,
2020 ("the Order"), issued by the Central Government of
India in terms of sub-section (11) of section 143 of the Act, we
give in the "Annexure 1" a statement on the matters specified
in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of 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 financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of 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 these financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) Based on the information and explanations provided to us and based on our examination of books of accounts, the Company has not accrued / paid any managerial remuneration to its directors. Accordingly, the provision of section 197 read with Schedule V to the Act are not required to be complied with;
(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 financial statements - Refer Note 42 to the financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. a) The management has represented that, to the
best of its knowledge and belief, and read with Note 48 to the 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 ("Intermediaries"), 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 Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
b) The management has represented that, to the best of its knowledge and belief, and read with Note 48 to the financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, 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 Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures performed that were 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. No dividend has been declared or paid during the year by the Company.
vi. As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable for the Company only w.e.f. April 1, 2023, reporting under this clause is not applicable.
For S R B C & CO LLP
Chartered Accountants ICAI Firm Registration Number: 324982E/E300003
per Amit Singh
Partner
Place of Signature: Mumbai Membership Number: 408869 Date: May 22, 2023 UDIN: 23408869BGXKKA8070
Mar 31, 2022
Report on the Audit of the Financial Statements
We have audited the accompanying financial statements of Sun Pharma Advanced Research Company Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2022, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including 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 financial statements give the information required by the Companies Act, 2013, as amended (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, 2022, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs), as 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 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 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 audit opinion on the financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the financial year ended March 31, 2022. 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. For each key audit matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s responsibilities for the audit of the financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial statements.
Key audit matter |
How our audit addressed the key audit matter |
(a) Revenue recognition (as described in Note 27 of the financial statements) |
|
The Company is engaged in the business of |
Our audit procedures amongst others included the following: |
Research and Development of pharmaceutical |
⢠Read the accounting policy for revenue recognition of the |
products. The Company has various |
Company and assessed compliance with the principles |
contractual arrangements with customers which are entered into at various stages of |
enunciated under Ind AS 115. |
research and development. The Company, in |
⢠Evaluated the design and tested the operating effectiveness |
line with Ind AS 115 recognises revenue based |
of management''s controls in respect of revenue recognition. |
on the contractual terms and performance |
⢠Obtained a sample of contracts and reviewed the terms of |
obligations with customers. Some of these |
the arrangements to determine whether the work performed |
arrangements involve judgments which may |
under the contract qualified for revenue recognition having |
impact the manner and timing of revenue recognition. |
regard to the performance obligations under the contracts. ⢠Assessed the disclosures in the accompanying financial |
Considering that contractual arrangements with customers involve judgments which may impact the manner and timing of revenue recognition, accordingly it is considered as a key audit matter. |
statements. |
Evaluation of direct tax and indirect tax litigations (as described in Note 42 of the financial statements) |
|
The Company has material direct tax |
Our audit procedures amongst others included the following: |
and indirect tax litigations which involve |
⢠Evaluated the design and tested the operating effectiveness |
significant judgment to determine the possible |
of controls in respect of the identification and evaluation |
outcome of these disputes and accordingly it is |
of tax litigations and the recording and reassessment of the |
considered as key audit matter. |
related liabilities and provisions and disclosures. ⢠Obtained list of ongoing tax litigations from management along with their assessment of the cases based on past precedents, judgements and matters in the jurisdiction, legal opinions sought by management, correspondences with tax department etc. ⢠Engaged tax specialists, to evaluate management''s assessment of the outcome of these litigations. Our specialists considered legal precedence and other rulings in evaluating management''s position on these tax litigations. ⢠Assessed contingent liability disclosure in the accompanying financial statements. |
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 Report and Board''s Report, but does not include the financial statements and our auditor''s report thereon. The Management Discussion and Analysis Report and Board''s Report is expected to be made available to us after the date of this auditor''s report.
Our opinion on the financial statements does not cover the other information and we will 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 identified above when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
Responsibilities of Management for the 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 financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the 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.
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
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.
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 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.
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 financial statements for the financial year ended March 31, 2022 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2020 (the "Order"), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the "Annexure 1" a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of Other Comprehensive Income, 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 financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of 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 these financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) Based on the information and explanations provided to us and based on our examination of books of accounts, the Company has not accrued / paid any managerial remuneration to its directors. Accordingly, the provision of section 197 read with Schedule V to the Act are not required to be complied with;
(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 financial statements - Refer Note 42 to the 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.
iv. (a) The management has represented
that, to the best of its knowledge and belief and read with note 48 to the 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 ("Intermediaries"), 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 Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(b) The management has represented that, to the best of its knowledge and belief and read with note 48 to the financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, 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 Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
c) Based on such audit procedures that were 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.
iv. No dividend has been declared or paid during the year by the Company.
For S R B C & CO LLP
Chartered Accountants ICAI Firm Registration Number: 324982E/E300003
per Paul Alvares
Partner
Membership Number: 105754 UDIN: 22105754AJCIAF4837
Place of Signature: Mumbai Date: May 17, 2022
Mar 31, 2021
To the Members of Sun Pharma Advanced Research Company Limited
Report on the Audit of the Financial Statements Opinion
We have audited the accompanying financial statements of Sun Pharma Advanced Research Company Limited (the âCompanyâ), which comprise the Balance Sheet as at March 31, 2021, the Statement of Profit and Loss, including the Statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the financial statements, including 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 financial statements give the information required by the Companies Act, 2013, as amended (the âActâ) 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, 2021, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
We conducted our audit of the financial statements in accordance with the Standards on Auditing (SAs), as specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the âAuditorâs Responsibilities for the Audit of the Financial Statementsâ section of our report. We are independent of the Company in accordance with the âCode of Ethicsâ 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 audit opinion on the financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the financial year ended March 31, 2021. These matters were addressed in the context of our audit of the financial statementsâ as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each key audit matter below, our description of how our audit addressed the matter is provided in that context.
We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditorâs responsibilities for the audit of the financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial statements.
Key audit matter |
How our audit addressed the key audit matter |
Revenue recognition (as described in Note 25 of the financial statements) |
|
The Company is engaged in the business of Research and Development of pharmaceutical products. The Company has various contractual arrangements with customers which are entered into at various stages of research and development. The Company, in line with Ind AS 115 recognizes revenue based on the contractual terms and performance obligations with customers. Some of these arrangements involve judgments which may impact |
Our audit procedures amongst others included the following: ⢠Read the accounting policy for revenue recognition of the Company and assessed compliance with the principles enunciated under Ind AS 115. ⢠Evaluated and tested the design and operating effectiveness of managementâs controls in respect of revenue recognition. |
the manner and timing of revenue recognition. |
⢠Obtained a sample of contracts and reviewed the terms of the |
Considering that contractual arrangements with customers involve judgments which may impact the manner and timing of revenue recognition, accordingly it is considered as a key audit matter. |
arrangements to determine whether the work performed under the contract qualified for revenue recognition having regard to the performance obligations under the contracts. |
⢠Assessed the disclosures in the accompanying financial statements. |
Key audit matter |
How our audit addressed the key audit matter |
Evaluation of direct tax and indirect tax litigations (as described in Note 40 of the financial statements) The Company has material direct tax and indirect tax litigations Our audit procedures amongst others included the following: which involve significant judgment to determine the possible ⢠Evaluated the design and tested the operating effectiveness of outcome of these disputes and accordingly it is considered as key audit matter. controls in respect of the identification and evaluation of tax audit matter. litigations and the recording and reassessment of the related liabilities and provisions and disclosures. ⢠Obtained list of ongoing tax litigations from management along with their assessment of the cases based on past precedents, judgements and matters in the jurisdiction, legal opinions sought by management, correspondences with tax department etc. ⢠Engaged tax specialists, to evaluate managementâs assessment of the outcome of these litigations. Our specialists considered legal precedence and other rulings in evaluating managementâs position on these tax litigations. ⢠Assessed contingent liability disclosure in the accompanying financial statements. |
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis Report and Boardâs Report, but does not include the financial statements and our auditorâs report thereon. The Management Discussion and Analysis Report and Boardâs Report is expected to be made available to us after the date of this auditorâs report.
Our opinion on the financial statements does not cover the other information and we will 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 identified above when it becomes available and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
Responsibilities of Management for the Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the 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.
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.
The Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
Auditorâs Responsibilities for the Audit of the Financial Statements
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.
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 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.
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 financial statements for the financial year ended March 31, 2021 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditorâs Report) Order, 2016 (the âOrderâ), issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the âAnnexure 1â a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by Section 143(3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
(c) The Balance Sheet, the Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written representations received from the directors as on March 31, 2021, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021, from being appointed as a director in terms of Section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls with reference to these financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(g) Based on the information and explanations provided to us and based on our examination of books of accounts, the Company has not accrued / paid any managerial remuneration to its directors. Accordingly, the provision of section 197 read with Schedule V to the Act are not required to be complied with;
(h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 40 to the 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.
For S R B C & CO LLP
Chartered Accountants ICAI Firm Registration Number: 324982E/E300003
per Paul Alvares
Partner
Place of Signature: Pune Membership Number: 105754
Date: May 17, 2021 UDIN: 21105754AAAACM2112
Mar 31, 2018
Report on the Ind AS Financial Statements
We have audited the accompanying Ind AS financial statements of Sun Pharma Advanced Research Company Limited (âthe Companyâ), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, including the statement of 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.
Managementâs Responsibility for the Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (âthe Actâ) with respect to the preparation of these Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 the design, implementation and maintenance of adequate internal financial control 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.
Auditorâs Responsibility
Our responsibility is to express an opinion on these Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of the Ind
AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditorâs 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 Companyâs 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 accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the Ind AS financial statements. 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
In our opinion and to the best of our information and according to the explanations given to us, the 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, its loss including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
Other Matter
The comparative financial information of the Company for the year ended March 31, 2017 and the transition date opening balance sheet as at April 01, 2016 included in these Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the accounting principles generally accepted in India, including the Companies (Accounting Standards) Rules, 2006 (as amended) specified under section 133 of the Act, read with the Companies (Accounts) Rules, 2014 audited by the predecessor auditor whose report for the year ended March 31, 2017 and March 31, 2016 dated May 05, 2017 and May 04, 2016 respectively expressed an unmodified opinion on those financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Ind AS, which have been audited by us.
Report on Other Legal and Regulatory Requirements
1. 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 Act, we give in the Annexure 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.
2. As required by section 143 (3) of the Act, we report that:
(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 it appears from our examination of those books;
(c) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of written representations received from the directors as on March 31, 2018, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2018, from being appointed as a director in terms of section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report
(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 Ind AS financial statements - Refer Note 41 to the Ind AS 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.
Referred to in paragraph 1 under the heading âReport on Other Legal and Regulatory Requirementsâ of our report of even date on the financial statements of Sun Pharma Advanced Research Company Limited
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given by the management with respect to the title deeds of immovable property included in property, plant and equipment and based on the examination of the High Court Order for demerger dated March 28, 2007, provided to us, we report the following:
Particulars of |
Gross Block |
Net Block |
Remarks |
building |
(as at March 31, 2018) Rs. in Lakhs |
(as at March 31, 2018) Rs. in Lakhs |
|
R&D building |
285.99 |
219.29 |
The building was |
(4th and 5th |
transferred (pending |
||
Floor) located |
registration) to the |
||
at 17-B Mahal |
Company pursuant |
||
Industrial |
to a scheme of |
||
Estate, Off. |
arrangement in the |
||
Mahakali |
nature of demerger and |
||
Caves Road, |
transfer of Innovative |
||
Andheri |
Research and |
||
(West), |
Development business |
||
Mumbai |
of Sun Pharmaceutical |
||
-400 093, |
Industries Limited |
||
admeasuring |
under Section 391 to |
||
1,041.29 |
394 of the Companies |
||
square |
Act, 1956 in terms of |
||
meters. |
the approval of the Honorable High court of Gujarat. The agreement is in the name of Sun Pharmaceutical Industries Limited. |
(ii) According to the information and explanation given to us and having regard to the nature of the Companyâs business, the Company does not have any inventories during the year since, procurements are issued directly for consumption to the user department and therefore, the question of reporting on whether, physical verification has been carried out at reasonable intervals and discrepancies noticed on physical verification were material, does not arise.
(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii) (a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.
(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities granted in respect of which provisions of section 185 and 186 of the Companies Act, 2013 are applicable and hence not commented upon.
(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.
(vi) To the best of our knowledge and as explained, the Company is not in the business of sale of any goods. Therefore, in our opinion, the provisions of clause 3(vi) of the Order are not applicable to the Company.
(vii) (a) Undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, sales-tax, service tax, duty of custom, value added tax, goods and service tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases. The provisions relating to duty of excise are not applicable to the Company.
According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employeesâ state insurance, income-tax, service tax, sales-tax, duty of custom, value added tax, goods and service tax, cess and other statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to duty of excise are not applicable to the Company.
(b) According to the records of the Company, the dues of income-tax, sales-tax, service tax, duty of custom, value added tax, goods and service tax and cess which have not been deposited on account of any dispute are as follows-
Name of the statute |
Nature of the dues |
Amount Involved (Rs. in lakhs) |
Amount paid under protest (Rs.in lakhs) |
Amount unpaid (Rs. in lakhs) |
Period to which the amount relates |
Forum where the dispute is pending |
The Income Tax Act,1961 |
Income Tax and Interest |
8,617.63 |
3,903.22 |
4,714.41 |
A.Y. 2011-12; 2013-14 and 2014-15 |
Commissioner of Income Tax (Appeals) |
The Central Excise Act,1944 |
Service Tax |
23.53 |
- |
23.53 |
October 2008 to March 2012 |
Commissioner (Appeals) |
The Central Excise Act,1944 |
Service Tax |
49.20 |
- |
49.20 |
July 2012 to March 2016 |
Commissioner (Appeals) |
(viii) In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowing to banks or government. The Company did not have any outstanding dues in respect of financial institution or debentures during the year.
(ix) According to the information and explanations given by the management, the Company has not raised any money way of initial public offer / further public offer / debt instruments and term loans hence, reporting under clause (ix) is not applicable to the Company and hence not commented upon.
(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the company or no fraud on the company by the officers and employees of the Company has been noticed or reported during the year.
(xi) According to the information and explanations given by the management, the Company has not paid managerial remuneration and accordingly, the provisions of section 197 read with Schedule V of the Act are not applicable to the Company and hence reporting under clause 3(xi) is not applicable and hence not commented upon.
(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon.
(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.
(xiv) According to the information and explanations given by the management, the Company has complied with provisions of section 42 of the Companies Act, 2013 in respect of the preferential allotment of shares. According to the information and explanations given by the management, we report that the amounts raised, have been used for the purposes for which the funds were raised. The Company has not made any private placement of shares / fully or partly convertible debentures during the year.
(xv) According to the information and explanations given by the management, the Company has not entered into any noncash transactions with directors or persons connected with him as referred to in section 192 of Companies Act, 2013.
(xvi) According to the information and explanations given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.
For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Ravi Bansal
Partner
Membership Number: 49365
Place of Signature: Mumbai
Date: May 08, 2018
Mar 31, 2017
Independent Auditorâs Report
TO THE MEMBERS OF
SUN PHARMA ADVANCED RESEARCH COMPANY LIMITED
Report on the Financial Statements
We have audited the accompanying financial statements of SUN PHARMA ADVANCED RESEARCH COMPANY LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March, 2017, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these 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 principles generally accepted in India, including the Accounting Standards prescribed under section 133 of the Act.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor''s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
In conducting our audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.
We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.
Opinion
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 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 31st March, 2017, and its loss and its cash flows for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by Section 143 (3) of the Act, based on our audit we report, to the extent applicable that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and the reports of the other auditors.
c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account.
d) In our opinion, the aforesaid financial statements comply with the Accounting Standards prescribed under section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31st March, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 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, refer to our separate Report in "Annexure A". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.
g) With respect to the other matters to be included in the Auditor''s Report in accordance with 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 24(i)(b) and (c) to the 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.
iv. The Company has provided requisite disclosures in the financial statements as regards its holding and dealings in Specified Bank Notes as defined in the Notification S.O. 3407(E) dated the 8th November, 2016 of the Ministry of Finance, during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures performed and the representations provided to us by the management we report that the disclosures are in accordance with the books of account maintained by the Company and as produced to us by the Management. Refer Note 27 to the financial statements.
2. As required by the Companies (Auditor''s Report) Order, 2016 ("the Order") issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B" a statement on the matters specified in paragraphs 3 and 4 of the Order.
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
(Referred to in paragraph 1(f) under âReport on Other Legal and Regulatory Requirements'' section of our report of even date)
We have audited the internal financial controls over financial reporting of SUN PHARMA ADVANCED RESEARCH COMPANY LIMITED ("the Company") as of 31st March, 2017 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
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 ("the Guidance Note") issued by the Institute of Chartered Accountants of India ("the 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 respective 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.
Auditor''s Responsibility
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 issued by the ICAI and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
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
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2017, based on the internal control over financial reporting criteria established by the respective Company considering the essential components of internal control stated in the Guidance Note issued by the ICAI.
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a program of verification of fixed assets to cover all the items in a phased manner over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.
(c) According to the information and explanations given to us and the records examined by us in respect of title deeds of immovable property based on the examination of the High Court Order for Demerger dated 28th March, 2007, provided to us, we report the following:
Particulars of building |
Gross Block (as at 31st March, 2017) '' in Lakhs |
Net Block (as at 31st March, 2017) '' in Lakhs |
Remarks |
R&D buildings located at Tandalja, Vadodara (Gujrat) admeasuring 14615.50m2 |
1,838.21 |
1,504.77 |
The buildings were transferred (pending registration) to the Company pursuant to a scheme of arrangement in the nature of demerger and transfer of Innovative Research and Development business of Sun Pharmaceutical Industries Limited under Section 391 to 394 of the Companies Act, 1956 in terms of the approval of the Honourable High Court of Gujarat. The agreements are in the name of Sun Pharmaceutical Industries Limited. |
R&D building located at Mahakali Caves Road, Andheri, Mumbai admeasuring 1041.29m2 |
285.99 |
224.08 |
(ii) According to the information and explanation given to us and having regard to the nature of the Company''s business, the Company does not have any inventories during the year since, procurements are issued directly for consumption to the user department and therefore, the question of reporting on whether; physical verification has been carried out at reasonable intervals and discrepancies noticed on physical verification were material, does not arise.
(iii) The Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 ("the Act").
(iv) The Company has not granted any loans, made investments or provided guarantees and hence reporting under clause 3(iv) of the Companies (Auditor''s Report) Order, 2016 ("the CARO 2016") is not applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposit and the provisions of sections 73 to 76 of the Act are not applicable and hence reporting under clause 3(v) of the CARO 2016 is also not applicable.
(vi) In respect of maintenance of Cost records under section 148(1) of the Act, having regard to the nature of the Company''s business / activities, reporting under clause 3(vi) of the CARO 2016 is not applicable.
(vii) According to the information and explanations given to us, in respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, cess and other material statutory dues applicable to it to the appropriate authorities. Having regard to the nature of the Company''s business / activities, statutory dues in respect of Excise duty are not applicable to the Company.
(b) There were no undisputed amounts payable in respect of Provident Fund, Employees'' State Insurance, Income-tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax,cess and other material statutory dues in arrears as at 31st March, 2017 for a period of more than six months from the date they became payable.
(c) Details of dues of Income-tax which have not been deposited as on 31st March, 2017 on account of disputes are given below:
Name of Statute |
Nature of Dues |
Forum Where Dispute is Pending |
Period to which the Amount Relates |
Amount Involved (Rs, in Lakhs) |
Amount Paid under protest (Rs, in Lakhs) |
Amount Unpaid (Rs, in Lakhs) |
The Income Tax Act, 1961 |
Income Tax and Interest |
Commissioner of Income Tax (Appeals) |
Assessment Year 2011-12 |
1,812.00 |
1,812.00 |
|
The Income Tax Act, 1961 |
Income Tax and Interest |
Commissioner of Income Tax (Appeals) |
Assessment Year 2013-14 |
3,287.06 |
650.00 |
2,637.06 |
(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of loans to banks and government. The Company has not taken any borrowings from financial institutions and has not issued any debentures.
(ix) In our opinion and according to the information and explanations given to us, the Company has utilized the term loans for the purposes for which they were obtained. The Company has not raised moneys by way of initial public offer/ further public offer (including debt instruments).
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company and no material fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) According to the information and explanations given to us, the Company has not paid managerial remuneration and the provisions of section 197 read with Schedule V to the Act are not applicable and hence reporting under clause 3(xi) of the CARO 2016 is not applicable.
(xii) The Company is not a Nidhi Company and hence reporting under clause 3(xii) of the CARO 2016 is not applicable.
(xiii) In our opinion and according to the information and explanations given to us, the Company is in compliance with sections 188 and 177 of the Act, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements etc. as required by the applicable accounting standards.
(xiv) During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures and hence reporting under clause 3(xiv) of the CARO 2016 is not applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its directors or persons connected with him and hence provisions of section 192 of the Act are not applicable.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and hence reporting under clause 3(xvi) of the CARO 2016 is not applicable.
For Deloitte Haskins & Sells LLP
Chartered Accountants
(Firm''s Registration No. 117366W/W-100018
Rajesh K. Hiranandani
Partner
(Membership No. 36920)
Place : Mumbai
Date : 5th May, 2017
Mar 31, 2014
We have audited the accompanying financial statements of SUN PHARMA
ADVANCED RESEARCH COMPANY LIMITED ("the Company"), which comprise
the Balance Sheet as at 31st March, 2014, the Statement of Profit
and Loss and the Cash Flow Statement for the year then ended, and
a summary of the significant accounting policies and other
explanatory information.
Management''s Responsibility for the Financial Statements
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") (which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General Circular
15/2013 dated 13th September, 2013 of the Ministry of Corporate
Affairs) and in accordance with the accounting principles generally
accepted in India. 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
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal
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 Company''s internal control. An
audit also includes evaluating the appropriateness of the accounting
policies used and the reasonableness of the accounting estimates made
by the Management, as well as evaluating the overall presentation of
the financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion and to the best of our information and according to the
explanations given to us, theaforesaid financial statements, read with
the ''Emphasis of Matter'' paragraph below, 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 31st March, 2014;
(b) in the case of the Statement of Profit and Loss, of the profit of
the Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Emphasis of Matter
We draw attention to Note 41 to the financial statements relating to
managerial remuneration paid / payable which is in excess of the limits
approved by the Central Government to the extent of Rs. 19,966 Thousand.
In this regard, the Company has made further representations to the
Central Government, the response in respect of which is awaited.
Our opinion is not qualified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
2. 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 purposes of our
audit.
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as it appears from our examination of
those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
notified under the Act (which continue to be applicable in respect of
Section 133 of the Companies Act, 2013 in terms of General
Circular 15/2013 dated 13th September, 2013 of the Ministry of
Corporate Affairs).
(e) On the basis of the written representations received from the
directors as on 31st March, 2014 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2014
from being appointed as a director in terms of Section 274(l)(g) of the
Act.
ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT
(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date)
(i) Having regard to the nature of the Company''s business / activities
/ results during the year, clauses vi, viii, xii, xiii, xiv, xv, xvi,
xviii and xix of paragraph 4 of the Order are not applicable to the
Company.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanations given to us, no material discrepancies were noticed on
such verification.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) Accordingtothe information and explanations given to us and
having regard to the nature of the Company''s business, the Company does
not have any inventories as at the balance sheet date since,
procurements are issued directly for consumption to the user department
and therefore, the question of reporting on whether; physical
verification has been carried out at reasonable intervals; procedures
of physical verification of inventories were reasonable and adequate;
and discrepancies noticed on physical verification were material, does
not arise. On the basis of our examination of records of inventories,
in our opinion, the Company has generally maintained proper records of
its inventories.
(iv) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the Register maintained
under Section 301 of the Companies Act, 1956.
In respect of loans, secured or unsecured, taken by the Company from
companies, firms or other parties covered in the Register maintained
under Section 301 of the Companies Act, 1956, according to the
information and explanations given to us:
(a) The Company has taken loans, repayable on demand, aggregating Rs.
311,000 thousand from one party during the year. At the year-end, the
outstanding balance of such loans taken was Rs. Nil and the maximum
amount involved during the year was Rs. 878,410 thousand (number of
parties - one).
(b) The rate of interest and other terms and conditions of such loans
are, in our opinion, prima facie not prejudicial to the interest of the
Company.
(c) The payment of the principal amounts and interest in respect of
such loans are regular/ as per stipulations.
(v) In our opinion and according to the information and explanations
given to us, having regard to the nature of the Company''s business, a
comparison of prices could not be made, in respect of sale of goods
(technology/ know-how) and services, in the absence of similar
transactions with other parties and in respect of some of the items
purchased are of special nature, in the absence of similar transactions
with other parties or suitable alternative sources are not readily
available for obtaining 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 purchases of consumables and
fixed assets and the sale of goods (technology/ know-how) and services.
During the course of our audit, we have not observed any major weakness
in such internal control system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered in the Register maintained under the said
Section have been so entered.
(b) Where each ofsuchtransactionfexcludingloans reported under
paragraph (iv) above) is in excess of Rs. 5 lakhs in respect of any
party, the transactions are of special nature, having regard to our
comments in paragraph (v) above, a comparison of prices could not be
made in the absence of similar transactions with other parties or
suitable alternative sources are not readily available for obtaining
comparable quotations. Hence, we are unable to comment whether such
transactions have been made at prices which are prima facie reasonable
having regard to the prevailing market prices at the relevant time.
(vii) In our opinion, the internal audit functions carried out during
the year by firms of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) According to the information and explanations given to us, in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Employees'' State Insurance,
Income-tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty and other
material statutory dues applicable to it with the appropriate
authorities.
(b) There were no undisputed amounts payable in respect of Provident
Fund, Employees'' State Insurance, Income- tax, Sales Tax, Wealth Tax,
Service Tax, Customs Duty and other material statutory dues in arrears
as at 31st March, 2014 for a period of more than six months from the
date they became payable.
(c) There were no dues in respect of Income-tax, Sales Tax, Wealth Tax,
Service Tax and Customs Duty which have not been deposited as on 31st
March, 2014 on account of any dispute.
(d) Having regards to the nature of the Company''s business /activities/
results, statutory dues in respect of Investor Education and Protection
Fund and Excise Duty are not applicable to the Company.
[ix) The accumulated losses i.e. deficit in the Statement of Profit and
Loss of the Company at the end of the financial year are not less than
fifty percent of its net worth and the Company has incurred cash losses
only during the preceding year but has not incurred any cash loss
during the current financial year.
[x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks. The Company does not have any dues to financial institutions and
has not issued any debentures.
(xi) In our opinion and according to the information and explanations
given to us, and on an overall examination of the Balance Sheet of the
Company, we report that funds raised on short-term basis have, prima
facie, not been used during the year for long-term investment.
(xii) The Management has disclosed the end use of money raised by
public issues in the notes to the financial statements and we have
verified the same.
(xiii) To the best of our knowledge and accordingto the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS LLP
Chartered Accountants
(Firm''s Registration No. 117366W/W-100018)
Rajesh K. Hiranandani
Partner
(Membership No. 36920)
MUMBAI, 3rd May, 2014
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of SUN PHARMA
ADVANCED RESEARCH COMPANY LIMITED ("the Company"), which comprise the
Balance Sheet as at 31st March, 2013, the Statement of Profit and Loss
and the Cash Flow Statement for the year then ended, and a summary of
the significant accounting policies and other explanatory information.
Management''s Responsibility for the Financial Statements
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 Section 211(3C)
of the Companies Act, 1956 ("the Act") and in accordance with the
accounting principles generally accepted in India. 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
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the Standards on Auditing issued by the Institute of Chartered
Accountants of India. Those Standards require that we comply with the
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal 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 Company''s internal control. An audit also includes
evaluating the appropriateness of the accounting policies used and the
reasonableness of the accounting estimates made by the Management, as
well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
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 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 31st March, 2013;
(b) in the case of the Statement of Profit and Loss, of the loss of the
Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
Report on Other Legal and Regulatory Requirements
1. As required by the Companies (Auditor''s Report) Order, 2003 ("the
Order") issued by the Central Government in terms of Section 227(4A) of
the Act, we give in the Annexure a statement on the matters specified
in paragraphs 4 and 5 of the Order.
2. 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 purposes of our
audit.
(b) In our opinion, proper books of account as required by law have
been kept by the Company so far as it appears from our examination of
those books.
(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account.
(d) In our opinion, the Balance Sheet, the Statement of Profit and
Loss, and the Cash Flow Statement comply with the Accounting Standards
referred to in Section 211(3C) of the Act.
(e) On the basis of the written representations received from the
directors as on 31st March, 2013 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2013
from being appointed as a director in terms of Section 274(1)(g) of the
Act.
(i) Having regard to the nature of the Company''s business / activities
/ results during the year, clauses vi, viii, xii, xiii, xiv, xv, xviii
and xix of paragraph 4 of the Order are not applicable to the Company.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanations given to us, no material discrepancies were noticed on
such verification.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) According to the information and explanations given to us and
having regard to the nature of the Company''s business, the Company does
not have any inventories as at the balance sheet date since,
procurements are issued directly for consumption to the user department
and therefore, the question of reporting on whether; physical
verification has been carried out at reasonable intervals; procedures
of physical verification of inventories were reasonable and adequate;
and discrepancies noticed on physical verification were material, does
not arise. On the basis of our examination of records of inventories,
in our opinion, the Company has generally maintained proper records of
its inventories.
(iv) The Company has not granted any loans, secured or unsecured, to
companies, firms or other parties covered in the Register maintained
under Section 301 of the Companies Act, 1956.
In respect of loans, secured or unsecured, taken by the Company from
companies, firms or other parties covered in the Register maintained
under Section 301 of the Companies Act, 1956, according to the
information and explanations given to us:
(a) The Company has taken loans, repayable on demand, including
interest accrued thereon converted into loans as per the terms and
conditions of loans, aggregating Rs. 813,410 thousand from one party
during the year. At the year-end, the outstanding balances of such
loans taken aggregated Rs. 738,410 thousand(number of parties - one)
and the maximum amount involved during the year was Rs. 738,410
thousand (number of parties - one).
(b) The rate of interest and other terms and conditions of such loans
are, in our opinion, prima facie not prejudicial to the interest of the
Company.
(c) The payment of the principal amounts and interest in respect of
such loans are regular/ as per stipulations.
(v) In our opinion and according to the information and explanations
given to us, having regard to the nature of the Company''s business, a
comparison of prices could not be made, in respect of sale of goods
(technology / know-how) and services, in the absence of similar
transactions with other parties and in respect of some of the items
purchased being of special nature, in the absence of similar
transactions with other parties or suitable alternative sources being
not readily available for obtaining 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
consumables and fixed assets and the sale of goods (technology / know-
how) and services. During the course of our audit, we have not observed
any major weakness in such internal control system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered into the Register maintained under the
said Section have been so entered.
(b) Where each of such transaction is in excess of Rs. 5 lakhs in
respect of any party, and the transactions are of special nature;
having regard to the nature of Company''s business, a comparison of
prices could not be made in the absence of similar transactions with
other parties or suitable alternative sources were not readily
available for obtaining comparable quotations. Hence, we are unable to
comment whether such transactions have been made at prices which are
prima facie reasonable having regard to the prevailing market prices at
the relevant time.
(vii) In our opinion, the internal audit functions carried out during
the year by firms of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Employees'' State Insurance,
Income-tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty and other
material statutory dues applicable to it with the appropriate
authorities.
(b) There were no undisputed amounts payable in respect of Provident
Fund, Employees'' State Insurance, Income-tax, Sales Tax, Wealth Tax,
Service Tax, Customs Duty and other material statutory dues in arrears
as at 31st March, 2013 for a period of more than six months from the
date they became payable.
(c) There were no dues in respect of Income-tax, Sales Tax, Wealth Tax,
Service Tax and Customs Duty which have not been deposited as on 31st
March, 2013 on account of any dispute.
(d) Having regards to the nature of the Company''s business / activities
/ results during the year, statutory dues in respect of Investor
Education and Protection Fund and Excise Duty are not applicable to the
Company.
(ix) The accumulated losses i.e. deficit in the Statement of Profit and
Loss of the Company at the end of the financial year are not less than
fifty percent of its net worth and the Company has incurred cash losses
in the current financial year and in the immediately preceding
financial year.
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks. The Company does not have any dues to financial institutions and
has not issued any debentures.
(xi) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained. However, the term loan, to the extent of Rs.
8,350 thousand, obtained from the Department of Science and Technology
(DST), Government of India, remained unapplied for the purpose for
which it was availed and was accordingly refunded.
(xii) In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that funds raised on short-term basis have, prima facie, not
been used during the year for long-term investment.
(xiii) The Management has disclosed the end use of money raised by
public issues in the notes to the financial statements and we have
verified the same.
(xiv) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm Registration No. 117366W)
Rajesh K Hiranandani
Partner
(Membership No. 36920)
VADODARA, 14th May, 2013
Mar 31, 2012
1. We have audited the attached Balance Sheet of SUN PHARMA ADVANCED
RESEARCH COMPANY LIMITED ("the Company") as at 31st March, 2012, the
Statement of Profit and Loss and the Cash Flow Statement of the Company
for the year ended on that date, both 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 the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and the disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates
made by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. Without qualifying our opinion, we draw attention to Note 27 to the
financial statements which indicates that, as at 31st March, 2012, the
accumulated deficit of Rs 1,212,968 thousand in Statement of Profit and
Loss has exceeded the aggregate of general reserve and paid up equity
share capital, resulting in the net worth being negative at Rs 666,086
thousand, as represented by shareholders' funds and also that the
Company's current liabilities have exceeded its current assets by Rs
1,267,868 thousand. Notwithstanding the foregoing, the financial
statements have been prepared on a going concern basis for the reasons
stated in the said Note.
4. As required by the Companies (Auditor's Report) Order, 2003 (CARO)
issued by the Central Government of India in terms of Section 227(4A)
of the Companies Act, 1956, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order.
5. Further to our comments in the Annexure referred to in paragraph 4
above and read with our comments in paragraph 3 above, we report that:
(i) 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;
(ii) 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;
(iii) the Balance Sheet, the Statement of Profit and Loss and the Cash
Flow Statement dealt with by this report are in agreement with the
books of account;
(iv) in our opinion, the Balance Sheet, the Statement of Profit and
Loss and the Cash Flow Statement dealt with by this report are in
compliance with the Accounting Standards referred to in Section 211(3C)
of the Companies Act, 1956;
(v) in our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956 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 31st March, 2012;
(b) in the case of the Statement of Profit and Loss, of the loss of the
Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for the year ended on that date.
6. On the basis of written representations received from the Directors
as on 31st March, 2012 and taken on record by the Board of Directors,
we report that none of the Directors is disqualified as on 31st March,
2012 from being appointed as a director in terms of Section 274(1)(g)
of the Companies Act, 1956.
ANNEXURE TO THE AUDITORS' REPORT
(Referred to in paragraph 4 of our report of even date)
(i) Having regard to the nature of the Company's business / activities
/ results, clauses vi, viii, xii, xiii, xiv, xv, xviii, xix and xx of
CARO are not applicable.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanations given to us, no material discrepancies were noticed on
such verification.
(c) Thefixed assets disposed off duringtheyear, in ouropinion, do not
constitute a substantial part of the fixed assets of the Company and
such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) According to the information and explanations given to us and
having regard to the nature of the Company's business, the Company does
not have any inventories as at the balance sheet date since,
procurements are issued directly for consumption to the user department
and therefore, the question of reporting on whether; physical
verification has been carried out at reasonable intervals; procedures
of physical verification of inventories were reasonable and adequate;
and discrepancies noticed on physical verification were material, does
not arise. On the basis of our examination of records of inventories,
in our opinion, the Company has maintained proper records of its
inventories.
(iv) The Company has neither granted nor taken any loans, secured or
unsecured, to / from companies, firms or other parties listed in the
Register maintained under Section 301 of the Companies Act, 1956.
(v) In our opinion and according to the information and explanations
given to us and having regard to the nature of the Company's business,
a comparison of prices could not be made, in respect of sale of goods
(technology / know-how) and services, in the absence of similar
transactions with other parties and in respect of some of the items
purchased being of special nature, in the absence of similar
transactions with other parties or suitable alternative sources being
not readily available for obtaining 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
consumables and fixed assets and the sale of goods (technology / know-
how) and services. During the course of our audit, we have not observed
any major weakness in such internal control system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contracts or arrangements referred to in Section
301 that needed to be entered into the Register maintained under the
said Section have been so entered.
(b) Where each of such transaction is in excess of Rs 5 lakhs in respect
of any party, having regard to the nature of Company's business, the
transactions are of special nature and comparison of prices could not
be made in the absence of similar transactions with other parties or
suitable alternative sources are not readily available for obtaining
comparable quotations, and hence, we are unable to comment whether the
transactions have been made at prices which are prima facie reasonable
having regard to the prevailing market prices at the relevant time.
(vii) In our opinion, the internal audit functions carried out during
the year by firms of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) According to the information and explanations given to us in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Employees' State Insurance,
Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty and other
material statutory dues applicable to it with the appropriate
authorities.
(b) There were no undisputed amounts payable in respect of Income-tax,
Sales Tax, Wealth Tax, Service Tax, Custom Duty and other material
statutory dues in arrears as at 31st March, 2012 for a period of more
than six months from the date they became payable.
(c) There were no dues in respect of Income-tax, Sales Tax, Wealth Tax,
Service Tax and Custom Duty which have not been deposited as on 31st
March, 2012 on account of any dispute.
(ix) The accumulated losses i.e. deficit in the Statement of Profit and
Loss ofthe Company at the end ofthe financial year are not less than
fifty percent of its net worth and the Company has incurred cash losses
in the current financial year and in the immediately precedingfinancial
year.
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks. The Company does not have any dues to financial institutions and
has not issued any debentures.
(xi) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained.
(xii) In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that, funds raised on short-term basis amounting to Rs 1,320,182
thousand have, prima facie, been used for long-term investment.
(xiii) To the best of our knowledge and according to the information
and explanations given to us, no fraud by the Company and no material
fraud on the Company has been noticed or reported during the year.
For DELOITTE HASKINS & SELLS
Chartered Accountants
(Firm Registration No. 117366W)
Rajesh K Hiranandani
Partner
(Membership No. 36920)
MUMBAI, 2nd May, 2012
Mar 31, 2011
1. We have audited the attached Balance Sheet of SUN PHARMA ADVANCED
RESEARCH COMPANY LIMITED ("the Company") as at 31st March, 2011, the
Profit and Loss Account and the Cash Flow Statement of the Company for
the year ended on that date, both annexed thereto. These financial
statements are the responsibility of the Companys Management. Our
responsibility is to express an opinion on these financial statements
based on our audit.
2. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and the disclosures in the financial statements. An audit also includes
assessing the accounting principles used and the significant estimates
made by the Management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. As required by the Companies (Auditors Report) Order, 2003 (CARO)
issued by the Central Government of India in terms of Section 227(4A)
of the Companies Act, 1956, we give in the Annexure a statement on the
matters specified in paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph 3
above, we report that:
(i) 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;
(ii) 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;
(iii) the Balance Sheet, the Profit and Loss Account and the Cash Flow
Statement dealt with by this report are in agreement with the books of
account;
(iv) in our opinion, the Balance Sheet, the Profit and Loss Account and
the Cash Flow Statement dealt with by this report are in compliance
with the Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956;
(v) in our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956 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 31st March, 2011;
(b) in the case of the Profit and Loss Account, of the loss of the
Company for the year ended on that date; and
(c) in the case of the Cash Flow Statement, of the cash flows of the
Company for year ended on that date.
5. On the basis of written representations received from the Directors
as on 31st March, 2011 and taken on record by the Board of Directors,
we report that none of the Directors is disqualified as on 31st March,
2011 from being appointed as a director in terms of Section 274(1)(g)
of the Companies Act, 1956.
Annexure to the Auditors Report
(Referred to in paragraph 3 of our report of even date)
(i) Having regard to the nature of the Companys business/activities/
results, clauses vi, viii, xii, xiii, xiv, xv, xviii, xix and xx of
CARO are not applicable.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of the fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verification.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) According to the information and explanations given to us and
having regard to the nature of the Companys business, the Company does
not have any inventories as at the balance sheet date since,
procurements are issued directly for consumption to the user department
and therefore, the question of reporting on whether; physical
verification has been carried out at reasonable intervals; procedures
of physical verification of inventories were reasonable and adequate;
and discrepancies noticed on physical verification were material, does
not arise. On the basis of our examination of records of inventories,
in our opinion, the Company has maintained proper records of its
inventories.
(iv) The Company has neither granted nor taken any loans, secured or
unsecured, to/from Companies, firms or other parties listed in the
Register maintained under Section 301 of the Companies Act, 1956.
(v) In our opinion and according to the information and explanations
given to us and having regard to the nature of the Companys business,
a comparison of prices could not be made, in respect of sale of goods
(technology) and services in the absence of similar transactions with
other parties and in respect of some of the items purchased being of
special nature, in the absence of similar transactions with other
parties or suitable alternative sources not being readily available for
obtaining 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 consumables and fixed assets and
the sale of goods (technology) and services. During the course of our
audit, we have not observed any major weakness in such internal control
system.
(vi) In respect of contracts or arrangements entered in the Register
maintained in pursuance of Section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contract or arrangements referred to in Section
301 that needed to be entered into the Register maintained under the
said Section have been so entered.
(b) Where each of such transaction are in excess of Rs. 5 lakhs in
respect of any party, having regard to the nature of the Companys
business, the transactions are of special nature and comparison of
prices could not be made in the absence of similar transactions with
other parties or suitable alternative sources are not readily available
for obtaining comparable quotations and hence, we are unable to comment
whether the transactions have been made at prices which are prima facie
reasonable having regard to the prevailing market prices at the
relevant time.
(vii) In our opinion, the internal audit functions carried out during
the year by firms of Chartered Accountants appointed by the Management
have been commensurate with the size of the Company and the nature of
its business.
(viii) According to the information and explanations given to us, in
respect of statutory dues:
(a) The Company has generally been regular in depositing undisputed
statutory dues, including, Provident Fund, Employees State Insurance,
Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise
Duty, Cess and other material statutory dues applicable to it with the
appropriate authorities.
(b) There were no undisputed amounts payable in respect of Income- tax,
Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and
other material statutory dues in arrears as at 31st March, 2011 for a
period of more than six months from the date they became payable.
(c) There were no dues in respect of Income-tax, Sales Tax, Wealth Tax,
Service Tax, Custom Duty, Excise Duty and Cess which have not been
deposited as on 31st March, 2011 on account of any dispute.
(ix) The accumulated losses of the Company at the end of the financial
year are not less than fifty percent of its net worth and the Company
has incurred cash losses in the current financial year and in the
immediately preceding financial year.
(x) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues to
banks. The Company does not have any dues to financial institutions
and has not issued any debentures.
(xi) In our opinion and according to the information and explanations
given to us, the term loans have been applied for the purposes for
which they were obtained, other than temporary deployment pending
application.
(xii) In our opinion and according to the information and explanations
given to us and on an overall examination of the Balance Sheet, we
report that, funds raised on short-term basis amounting to Rs. 504,918
Thousand have, prima facie, been used for long-term investment in fixed
assets.
(xiii) To the best of our knowledge and according to the information
and explanations given to us, no fraud by the Company and no material
fraud on the Company has been noticed or reported during the year.
For Deloitte Haskins & Sells
Chartered Accountants
(Registration No. 117366W)
Rajesh K Hiranandani
Partner
Place: Mumbai, 7th May, 2011 (Membership No. 36920)
Mar 31, 2010
1. We have audited the attached Balance Sheet of Sun Pharma Advanced
Research Company Limited (Ãthe CompanyÃ) as at March 31, 2010 and also
the Profit and Loss Account and the Cash Flow Statement for the year
ended 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 (Auditorsà 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:
(i) 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;
(ii) 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;
(iii) 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;
(iv) in our opinion and to the best of our information and according to
the explanations given to us, the said accounts read together with the
significant accounting policies and notes thereon give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India:
(a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2010;
(b) in the case of the Profit and Loss Account, of the loss for the
year ended on that date; and
(c) in the case of the Cash Flow Statement, of the Cash Flows for year
ended on that date.
5. On the basis of written representations received from directors as
on March 31, 2010 and taken on record by the Board of Directors, we
report that none of the directors is disqualified as on March 31, 2010
from being appointed as a director in terms of clause (g) of
sub-section (1) of Section 274 of the Companies Act, 1956;
Annexure to the Auditorsà Report (Referred to in paragraph 3 of our
report of even date) Sun Pharma Advanced Research Company Limited
(i) Having regards to the nature of the CompanyÃs business, Clauses
xiii, xiv, xviii, xix and xx of paragraph 4 of the Companies (AuditorsÃ
Report) Order, 2003, are not applicable.
(ii) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets.
(b) The fixed assets were physically verified during the year by the
Management in accordance with a regular programme of verification
which, in our opinion, provides for physical verification of all the
fixed assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verification.
(c) The fixed assets disposed off during the year, in our opinion, do
not constitute a substantial part of the fixed assets of the Company
and such disposal has, in our opinion, not affected the going concern
status of the Company.
(iii) According to the information and explanations given to us, the
Company did not have any inventory during the year.
(iv) The Company had neither granted nor taken any loan, secured or
unsecured, to or from Companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
(v) In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the items
purchased are of special nature and suitable alternative sources are
not readily available for obtaining comparable quotations, there is an
adequate internal control systems commensurate with the size of the
Company and nature of its business with regard to purchase of
consumables and fixed assets and for sale of goods (technology) and
services. During the course of our audit, we have not observed any
major weaknesses in such internal control systems.
(vi) In respect of contracts or arrangements entered in the register
maintained in pursuance of section 301 of the Companies Act, 1956, to
the best of our knowledge and belief and according to the information
and explanations given to us:
(a) The particulars of contract or arrangements referred to in Section
301 that needed to be entered into the register, maintained under the
said section have been so entered.
(b) Where each such transaction (excluding loans reported under
paragraph (iv) above) is in excess of Rs. 5 lakhs in respect of any
party, the transactions have been made at prices which are prima facie
reasonable having regard to prevailing market prices at the relevant
time, except in respect of certain purchases for which comparable
quotations are not available and in respect of which we are unable to
comment.
(vii) According to the information and explanations given to us, the
Company has not accepted any deposits from public during the year
within the meaning of Section 58A and 58AA or any other relevant
provisions of the Companies Act, 1956 and the Companies (Acceptance of
Deposits) Rules, 1975.
(viii) In our opinion, the internal audit functions carried out during
the year by firms of Chartered Accountants appointed by the management
have been commensurate with the size of the Company and the nature of
its business.
(ix) To the best of our knowledge and according to the information and
explanations given to us, the Central Government has not prescribed the
maintenance of cost records for any product of the Company under
Section 209 (1) (d) of the Companies Act, 1956.
(x) According to the information and explanations given to us, in
respect of statutory dues:
(a) The Company has been generally regular in depositing undisputed
statutory dues, including, Provident Fund, Employeesà State Insurance,
Income tax, Sales tax, Wealth Tax, Service Tax, Custom Duty, Excise
Duty, cess and other material statutory dues with the appropriate
authorities during the year. There were no dues payable in respect of
Investor Education and Protection Fund, during the year.
(b) There were no undisputed amounts payable in respect of Income Tax,
Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, cess and
other material statutory dues in arrears as at March 31, 2010 for a
period of more than six months from the date they became payable.
(c) There were no disputed dues in respect of Income Tax, Sales Tax,
Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other
material statutory dues during the year.
(xi) The Company has not yet completed a period of 5 years since
incorporation, accordingly reporting under Clause 4 (x) of the
Companies (AuditorÃs Report) Order, 2003 is not applicable to the
Company.
(xii) In our opinion and according to the information and explanation
given to us, the Company has not defaulted in repayment of dues to
banks. The Company has not obtained any borrowings from financial
institutions or by way of debentures.
(xiii) The Company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities.
(xiv) In our opinion and according to the information and explanation
given to us, the Company has not given any guarantees for loans taken
by others from banks and financial institutions.
(xv) To the best of our knowledge and belief and according to the
information and explanations given to us, the term loans have been
applied for the purposes for which they were obtained, other than
temporary deployment pending application.
(xvi) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we report
that the Company has, prima à facie, used funds raised on short term
basis through an increase in net current liabilities and losses
aggregating to Rs. 466,606 Thousand, towards long term investment in
fixed assets.
(xvii) To the best of our knowledge and belief and according to the
information and explanation given to us, no fraud on or by the Company
was noticed or reported during the year.
For Deloitte Haskins & Sells
Chartered Accountants
(Registration No. 117366W)
K. A. Katki
Place: Mumbai Partner
Date: May 22, 2010 (Membership No. 038568)
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