Home  »  Company  »  Vesuvius India  »  Quotes  »  Auditor Report
Enter the first few characters of Company and click 'Go'

Auditor Report of Vesuvius India Ltd.

Dec 31, 2015

We have audited the accompanying financial statements of Vesuvius India Limited ("the Company"), which comprise the Balance Sheet as at 31 December 2015, the Statement of Profit and Loss and the Cash Flow Statement for the year then ended, and a summary of 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 specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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.

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 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the 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, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of 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 we have obtained 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 31 December 2015 and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the Annexure a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extend applicable.

2. As required by section 143 (3) of the Act, report that:

(a) We have sought and obtained all the information and explanation 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, Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid Financial statements comply with Accounting Standards specified under Section 133 of the Act, read with rule 7 of the Companies (Accounts) Rules, 2014;

(e) On the basis of the written representations received from the directors as on 31 December 2015, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2015, from being appointed as a director in terms of section 164 (2) of the Act;

(f) 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, 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 26 (a) to the financial statement;

(ii) The Comany did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

(iii) There were no delays in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programmed of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programmed, certain fixed assets were physically verified by the management and no material discrepancies were noticed on such verification.

(ii) (a) The inventory, except goods-in-transit, has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification between the physical stocks and the book records.

(iii) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3 (iii) of the Order is not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company's specialized requirements and suitable alternative sources are not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any continuing failure to correct major weakness in the internal control system.

(v) The Company has not accepted any deposit from the public in accordance with the provision of section 73 to 76 of the Act and rules framed thereunder.

(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 148(1) of the Act in respect of the products manufactured by the Company and are of the opinion that, prima facie, the prescribed accounts and records have been made and maintained. However, we have not made detailed examination of the records.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Value added tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees' State Insurance, Income-tax, Sales-tax, Value added tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues were in arrears as at 31 December 2015 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, the following dues of Income-tax, Sales-tax, Value added tax, Service tax, Customs duty, Excise duty, Cess and Entry tax have not been deposited with the appropriate authorities on account of disputes:

Name of the directors Nature of the dues Amount Period to which

Income Tax Act,1961 Disallowances arising in income 952 Assessment years tax proceedings (Net of deposit 1997-98 to 2010-11 of Rs. 12,867 lakhs)

Central Excise Act,1944 Disallowance of Cenvat Credit 256 2006 to 2014

Central Excise Act, 1944 Non-payment of Excise 108 2000 Duty on Service charges and Machine hire charges

Central Excise Act, 1944 Penalty for delayed payment 20 June 1999 to April 2000 of differential excise duty for supply of goods under Advance Intermediate licence.

Customs Act, 1962 Classification of High Alumina 31 2005to2011 Cement

Finance Act, 1994 Non / short payment 12 2006-2008 of service tax

Central Sales Tax Act, Non-submission of 2,053 2002-03,2005-06, 1956 declaration form. (Net of 2008-09,2009-10, depositofRs. 106lakhs) 2010-11,2011-12

State Sales Tax Act Disallowance of Input credit 173 2005-06,2006-07 2003 (Net of depositof Rs. 99 lakhs) 2010-11,2011-12

The West Bengal Tax Entry Tax 230 June 2013 to on entry of Goods into December 2015 Local Areas Act, 2012



Name of the statute Forum where dispute is pending

Income Tax Act, 1961 Hon'ble High Court of Calcutta, Income Tax Appellate Tribunal,Commissioner of Income Tax (Appeals)

Central Exercise Act, 1994 Additional Commissioner, Assistant Commissioner, Commissioner(Appeals), Central Excise and Service Tax Appellate Tribunal, Supreme Court of India

Central Exercise Act, 1944 Central Excise and Service Tax Appellate Tribunal,

Central Exercise Act, 1944 Central Excise and Service Tax Appellate Tribunal

Customs Act, 1962 Central Excise and Service Tax Appellate Tribunal

Finaance Act, 1994 Central Excise and Service Tax Appellate Tribunal

Central sales Tax Act ,1956 Commissioner (Appeals), Sales Tax Appellate Tribunal, Hon'ble High Court of Calcutta

State sales Tax Act, 2003 Commissioner (Appeals), Supreme Court

The west Bengal Tax on entry of goods into local Areas Act, 2012 Hon'ble High Court of Calcutta

(c) According to the information and explanations given to us, the amount which were required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder has been transferred to such fund within time.

(viii) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(ix) According to the information and explanations given to us, the Company has neither taken any loan from financial institution or bank nor has it issued any debentures during the year.

(x) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xi) According to the information and explanations given to us, the Company did not have term loans outstanding during the year.

(xii) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

ForBSR&Co.LLP

Chartered Accountants

Firm's Registration No. 101248W/W-100022



Jayanta Mukhopadhyay

Place :Kolkata Partner

Date : February 26, 2016 Membership No. 055757


Dec 31, 2014

We have audited the accompanying financial statements of Vesuvius India Limited ("the Company"), which comprise the Balance Sheet as at 31 December 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 / Section 133 of the Companies Act 2013 (as applicable) ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our resposibility 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 disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the 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 circumtances, 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 accounting policies used and the reasonableness of the accounting estimates made by 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 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 the affairs of the Company as at 31 December 2014;

(b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, 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 Companies Act, 1956 /section 143(3) of Companies Act, 2013 (as applicable), we report that:

(a) we have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956/ section 133 of the Companies Act, 2013 (as applicable) and

(e) on the basis of written representations received from the directors as on 31 December 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2014, from being appointed as a director in terms of clause (g) of sub-section (I) of section 274 of the Companies Act, 1956 /section 164(2) of Companies Act, 2013 (as applicable).

Annexure to the Auditors''Report (REFERRED TO IN OUR REPORT OF EVEN DATE)

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programme, certain fixed assets were physically verified. No material discrepancies were noticed on such verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit, has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. No material discrepancies were noticed on verification between the physical stocks and the book records.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956 / section 189 of Companies Act, 2013 (as applicable). Thus paragraphs 4 (iii) (b) to (d), (f), (g) are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialised requirements and suitable alternative sources are not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of the contracts or arrangement referred to in Section 301 of the Companies Act, 1956 / section 189 of Companies Act, 2013 (as applicable), have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. For purchases of certain items of inventories and fixed assets that are for the Company''s specialised requirements and similarly for sale of certain goods that are for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1 )(d) of the Companies Act, 1956 / section 128 of Companies Act, 2013 (as applicable) in respect of the products manufactured by the Company and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees'' State Insurance, Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues were in arrears as at 31 December 2014, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, the following dues of Income tax, Excise duty and Custom Duty, Service tax, Sales tax and Entry tax have not been deposited with the appropriate authorities on account of disputes:

Name of the statute Nature of the dues Amount (Rs in lakhs)

Income Tax Act,1961 Disallowances arising in income 855 tax proceedings (Net of deposit of Rs. 12,867 lakhs)

Central Excise Act,1944 Disallowance of Cenvat Credit 226

Central Excise Act, 1944 For non payment of Excise 108 Duty on Service Charges and Machine hire charges

Central Excise Act, 1944 Penalty for delayed payment 20 of differential excise duty for supply of goods under Advance Intermediate licence.

Customs Act, 1962 Classification of High Alumina 31 Cement

Finance Act, 1994 For Non / short payment 12 of service tax

Central Sales Tax Act Due to non-submission of 2,235 declaration form. (Net of deposit odRs. 106 lakhs)

State Sales Tax Act Disallowance of Input credit 2,401 (Net of deposit of Rs. 99 lakhs)

The West Bengal Tax Entry Tax 138 on entry of Goods into Local Areas Act, 2012

Name of the Statute Period to which Forum where dispute amount relates is pending

Income Tax Act,1961 Assessment years Hon''ble High Court of 1997-98 to 2010-11 Calcutta, Income Tax Appellate Tribunal, Commissioner of Income Tax (Appeals)

Central Excise Act,1944 2006 to 2014 Additional Commissioner, Assistant Commissioner Central Excise and Service Tax Appellate Tribunal, Supreme Court

Central Excise Act, 1944 2000 Central Excise and Service Tax Appellate Tribunal,

Central Excise Act, 1944 June 1999 to April Central Excise and Service 2000 Tax Appellate Tribunal

Customs Act, 1962 2005 to 2011 Central Excise and Service Tax Appellate Tribunal

Finance Act, 1994 2006-2008 Central Excise and Service Tax Appellate Tribunal

Central Sales Tax Act 2002-03, 2005-06, Additional Commissioner, 2009-10, 2010-11, Commissioner (Appeals), 2011-12 Sale Tax Appellate Tribunal, Hon''ble High Court of Calcutta

State Sales Tax Act 2005-06, 2006-07 Additional Commissioner, 2010-11, 2011-12 Commissioner (Appeals), Sale TaxAppellate Tribunal, Supreme Court

The West Bengal Tax on June 2013 to Hon''ble High Court of entry of Goods into December 2014 Calcutta Local Areas Act, 2012

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has neither taken any loan from financial institution or bank nor has it issued any debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long- term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956/section 189 of the Companies Act, 2013 (as applicable)

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year.

For B S R & Co.LLP Chartered Accountants Firm''s Registration No. 101248W/W-100022

Jayanta Mukhopadhyay Place :Kolkata Partner Date : 24 February 2015 Membership No. 055757


Dec 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Vesuvius India Limited ("the Company"), which comprise the Balance Sheet as at 31 December 2013, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act"). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s 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 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 accounting policies used and the reasonableness of the accounting estimates made by 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 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 31 December 2013;

(b) in the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and

(c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 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 purpose of our audit;

(b) in our opinion proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

(d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; and

(e) on the basis of written representations received from the directors as on 31 December 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on 31 December 2013, 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 Auditor''s Report

REFERRED TO IN OUR REPORT OF EVEN DATE)

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. In accordance with this programme, certain fixed assets were physically verified. No. material discrepancies were noticed on such verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit, has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. No material discrepancies were noticed on verification between the physical stocks and the book records.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Thus paragraphs 4 (iii) (b) to (d), (f), (g) are not applicable to the Company.

(iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation that purchases of certain items of inventories and fixed assets are for the Company''s specialised requirements and suitable alternative sources are not available to obtain comparable quotations, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of the contract or arrangement referred to in section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. For purchases of certain items of inventories and fixed assets that are for the Company''s specialised requirements and similarly for sale of certain goods that are for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of the products manufactured by the Company and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(ix) (a) According to the information and explanations give to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provided Fund, Employees'' State Insurance, Investor Education and Protection Fund, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income- tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues were in arrears as at 31 December 2013 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, the following dues of Income tax, Excise duty, Custom Duty, Service tax, Sales tax and Entry tax have not been deposited with the appropriate authorities on account of disputes :

Name of the statute Nature of the dues Amount Period to which Forum where dispute (Rs in amount relates is pending Lakhs)

Income Tax Act, 1961 Disallowances arising 359 Assessment years Hon''ble High Court of In income tax proceedings 1997-98 to 2010-11 Calcutta, Income Tax (Net of deposit of Appellate Tribunal, Rs 10, 312 lakhs) Commissioner of Income Tax (Appeals)

Central Excise Act, 1944 Disallowance of Cenvat 141 2006 to 2012 Additional Commissioner, Credit Commissioner, Hon''ble High Court of Calcutta

Central Excise Act, 1944 For non payment of Excise 142 2000 Central Excise and Service Duty on Service Charges Tax Appellate Tribunal, and Machine hire charges Additional Commissioner

Central Excise Act, 1944 Penalty for delayed payment 20 June 1999 to Central Excise and Service of differential excise duty for April 2000 Tax Appellate Tribunal Supply of goods under Advance Intermediate licence

Customs Act, 1962 Classification of High 31 2005 to 2011 Central Excise and Service Alumina Cement Tax Appellate Tribunal

Finance Act, 1994 For Non / short 19 2006-2008, Central Excise and Service Payment of payment of 2008-09, Tax Appellate Tribunal, Service tax 2009-10 Additional Commissioner of service tax

Central Sales Tax Act Due to non- submission of 130 2002-03, Assistant Commissioner, Declaration form (Net of 2003-04, Commissioner (Appeals), Deposit of Rs. 106 lakhs) 2005-06, Sales Tax Appellate 2008-09, Tribunal, Hon''ble High 2009-10 Court of Calcutta

State Sales Tax Act Disallowance of Input credit 376 2005-06, 2006-07, Commissioner (Appeals), (Net of deposit of Rs. 99 lakhs) 2007-08, 2008-09, Sales Tax Appellate 2009-10 Tribunal, Supreme Court

The West Bengal Tax Entry Tax 66 June 2013 to Hon''ble High Court of on entry of Goods into December 2013 Calcutta Local Areas Act, 2012

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has neither taken any loan from financial institution or bank nor has it issued any debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or nidhi/mutual benefit fund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that funds raised on short term basis have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during year the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit for this year.

For B S R & Co. LLP

Chartered Accountants

Firm Registration No. 101248W

Vikram Advani

Place : Kolkata Partner

Date : 25 February 2014 Membership No. 091765


Dec 31, 2012

1. We have audited the attached Balance Sheet of Vesuvius India Limited (''the Company'') as at 31 December 2012, the Statement of Profit and Loss and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company''s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor''s Report) Order, 2003 (''the Order''), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as 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 agreementwith the books ofaccount;

(d) In our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(e) On the basis of written representations received from directors as on 31 December 2012, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 December 2012 from being appointed as a Director in terms of Section 274(1)(g) of the Companies Act, 1956;

(f) 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 fairview in conformity with the accounting principles generally accepted in India:

i) in the case of the Balance Sheet, of the state of the affairs of the Company as at 31 December 2012;

ii) in the case of the Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to the Auditors'' Report

(REFERRED TO IN OUR REPORT OF EVEN DATE )

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this programme, certain fixed assets were physically verified. No material discrepancies were noticed on such verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit, has been physically verified by the management during the year.

In ouropinion, the frequency ofsuch verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any majorweakness in the internal control system during the course ofthe audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts orarrangements referred to in Section 301 ofthe Companies Act, 1956 have been entered in the register required to be maintained underthat section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for purchases of certain items of inventories and fixed assets that are for the Company''s specialised requirements and similarly for sale of certain goods for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with size and nature of its business.

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central Government for maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 in respect of the products manufactured by the Company and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination ofthe records.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income-tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues were in arrears as at 31 December 2012, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Income tax, Sales tax, Service tax, Excise duty and Custom Duty which have not been deposited on account of any dispute are listed below:

Name of the statute Nature of the dues Amount Period Forum where dispute (Rs in is pending lakhs)

Income Tax Act,1961 Disallowances arising in income 740 Assessment years Hon''ble High Court of tax proceedings (Net of deposit 1997-98 to 2008-09 Calcutta, Income Tax of Rs. 9,058 lakhs) Appellate Tribunal, Commissioner of Income Tax (Appeals)

Central Excise Act,1944 Disallowance of Cenvat Credit 5 2008 Additional Commissioner

Central Excise Act,1944 For non payment of Excise 142 2000 Central Excise and Service Duty on Service Charges Tax Appellate Tribunal, and Machine hire charges Additional Commissioner

Central Excise Act,1944 Penalty for delayed payment 20 June 1999 to April 2000 Central Excise and Service of differential excise duty for Tax Appellate Tribunal supply of goods under Advance Intermediate licence.

Customs Act,1962 Classification of High Alumina 31 2005 to 2011 Central Excise and Service Cement Tax Appellate Tribunal

Service Tax For Non/short payment 7 2008-09, 2009-10 Commissioner (Appeals), of payment of service tax Additional Commissioner of Service Tax, Deputy Commissioner

Central Sales Tax Due to non- submission of 23 2009-10, 2010-2011 Sales Tax Appellate declaration form. Tribunal, Commissioner (Appeals), Assistant Commissioner

State Sales Tax Disallowance of Input credit 44 2005-06, 2006-07, 2007-08, Commissioner (Appeals) 2008-09

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial yearand in the immediately preceding financial year.

(xi) According to the information and explanations given to us, the Company has neither taken any loan from financial institution or bank nor has it issued any debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund ora nidhi/mutual benefitfund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks orfinancial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination ofthe balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long- term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the registermaintained underSection 301 ofthe Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit for this year.

For BSR & Co.

Chartered Accountants

Firm''s Registration No. 101248W

Vikram Advani

Partner

Place: Kolkata

Date : 26 February 2013 Membership No.091765


Dec 31, 2011

1. We have audited the attached Balance Sheet of Vesuvius India Limited ('the Company') as at 31 December 2011, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003 ('the Order'), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from directors as on 31 December 2011, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31 December 2011 from being appointed as a Director in terms of Section 274(1)(g) of the Companies Act, 1956;

(f) 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:

i) in the case of the Balance Sheet, of the state of the affairs of the Company asat31 December 2011;

ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its fixed assets. In accordance with this programme, certain fixed assets were physically verified. No material discrepancies were noticed on such verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit, has been physically verified by the management during the year.

In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for purchases of certain items of inventories and fixed assets that are for the Company's specialised requirements and similarly for sale of certain goods for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with size and nature of its business.

(viii) The Central Government has not prescribed the maintenance of cost records under Section 209(1)(d) of the Companies Act 1956 for any of the products manufactured/services rendered by the Company.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees' State Insurance, Income-tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, and other material statutory dues were in arrears as at 31 December 2011, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Wealth tax which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Income tax, Sales tax, Service tax, Excise duty and Custom Duty which have not been deposited on account of any dispute are listed below:

Name of the statute Nature of the dues Amount Period Forum where dispute is pending

Income Tax Act,1961 Disallowances arising in income 66,064 Assessment years Hon'ble High Court of tax proceedings (Net of deposit 1997-98 to 2008-09 Calcutta,Income Tax of Rs. 905,819 thousands) Appellate Tribunal, Commissioner of Income Tax (Appeals)

Central Excise Act,1944 Disallowance of Cenvat Credit 608 Nov 2000, 2007-2008 Commissioner (Appeals)

Central Excise Act,1944 For non payment of Excise 14,149 2000 Central Excise and Service Duty on Service Charges Tax Appellate Tribunal, and Machine hire charges Additional Commissioner

Central Excise Act,1944 Penalty for delayed payment 1,949 June 1999to April 2000 Central Excise and Service of differential excise duty for Tax Appellate Tribunal supply of goods under Advance Intermediate licence.

Customs Act,1962 Classification of High Alumina 1,555 2005-06 till date Commissioner of Cement Customs

Service Tax For Non / short payment 1,971 2006-2007, 2007-08, Commissioner (Appeals), of payment of service tax 2008-09, 2009-10, Additional Commissioner of 2010-2011 Service Tax, Deputy Commissioner

Central Sales Tax Duetonon- submission of 6,021 2007-08, 2008-09 Sales Tax Appellate declaration form. 2009-10, 2010-2011 Tribunal, Commissioner (Net of deposit of (Appeals), Assistant Rs. 8,299 thousand) Commissioner

State Sales Tax Disallowance of Input credit 4,352 2005-06, 2006-07, 2007-08, Commissioner (Appeals) 2008-09

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institution. The Company did not have any outstanding debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis and repaid during the year have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For BSR& Co.

Chartered Accountants

Firm's Registration No. 101248W

Vikram Advani

Partner

Place: Kolkata

Date : 29 February 2012 Membership Number No.091765


Dec 31, 2010

1. We have audited the attached Balance Sheet of Vesuvius India Limited (the Company) as at 31 December 2010, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (the Order), issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from directors as on 31 December 2010, and taken on record by the Board of Directors, we report that, none of the directors is disqualified as on 31 December 2010 from being appointed as a Director in terms of Section 274(1 )(g) of the Companies Act, 1956;

(f) 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:

i) in the case of the Balance Sheet, of the state of the affairs of the Company as at 31 December 2010;

ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to the AuditorsReport

(REFERRED TO IN OUR REPORT OF EVEN DATE )

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for purchases of certain items of inventories and fixed assets that are for the Companys specialised requirements and similarly for sale of certain goods for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with size and nature of its business.

(viii) The Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act 1956 for any of the products manufactured/services rendered by the Company.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with appropriate authorities.

There were no dues on account of Cess under Section 441A of the Act since the date from which the aforesaid Section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues were in arrears as at 31 December 2010, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Customs duty, Wealth tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Income tax, Sales tax, Service tax, Excise duty which have not been deposited on account of any dispute are listed below:

Name of Nature of the dues Amount Period to which Forum where the statute (Rs. 000) dispute relates dispute is pending

Income Tax Act,1961 Disallowances arising in income 63,306 Assessment years High Court at Calcutta, tax proceedings (Net of deposit 1997-98 to 2008-09 Commissioner of of Rs. 905,819 thousands) Income Tax (Appeals)

Central Excise Act, Disallowance of Cenvat Credit 6,277 2001,2004 -2005, Commissioner (Appeals), 1944 2005-2006, 2006-2007, Deputy Commissioner 2007-2008, 2008-2009, 2009-2010

(Upto Jan 2010) Central Excise Act, For non payment of Excise 14,148 2000 Central Excise and Service

1944 Duty on Service Charges Tax Appellate Tribunal, and Machine hire charges Commissioner Service tax

Central Excise Act, Penalty for delayed payment 1,949 June 1999 to April 2000 Central Excise and Service

1944 of differential excise duty for Tax Appellate Tribunal supply of goods under Advance

Intermediate licence.

The Finance Act, Disallowance of Service tax on 26,610 July 2006 to December 2007, Commissioner (Appeals),

1994 (Service Tax) intellectual property services February 2009 to August 2009, Central Excise and Service September 2009 to August 2010 Tax Appellate Tribunal

The Finance Act, Cenvat Credit availed 2,311 January 2006 to March 2007 Commissioner (Appeals)

1994 (Service Tax) against Service tax paid

on Goods Transport Agency

The Finance Act, Service tax with penalty 1,559 2008-09 Commissioner (Appeals)

1994 (Service Tax) on tax deducted at source

part of royalty

Central Sales Tax Act Due to non -submission of 39,059 2006-07, 2007-08, Commissioner (Appeals), declaration form. 2008-2009, 2009-10 Revisional Board, Sales (Net of deposit of Tax Appellate Tribunal

Rs. 16,041 thousands)

West Bengal Value Disallowance of Input credit 4,104 2005-06, 2006-07, Commissioner (Appeals)

Added Tax Act, 2003 2007-08

Kamataka Value Added Classification of Monolithics 9,950 2005 to 2007 Kamataka Sales Tax

Tax Act, 2003 (Net of deposit of Appellate Tribunal Rs. 9,950 thousands)



(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institution. The Company did not have any outstanding debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that the funds raised on short-term basis and repaid during the year have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Co.

Chartered Accountants

Firms Registration No. 101248W

Vikram Advani

Place: Kolkata Partner

Date : 25 February 2011 Membership No.: 091765


Dec 31, 2009

1. We have audited the attached Balance Sheet of Vesuvius India Limited as at 31 December 2009, the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledge and belief, were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of the books;

(c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

(e) On the basis of written representations received from directors as on 31 December 2009, and taken on record by the Board of Directors, we report that, none of the directors is disqualified as on 31 December 2009 from being appointed as a Director in terms of Section 274(1 )(g) of the Companies Act, 1956;

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:

i) in the case of the Balance Sheet, of the state of the affairs of the Company as at 31 December 2009; and

ii) in the case of the Profit and Loss Account, of the profit of the Company for the year ended on that date; and

iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Annexure to the Auditors Report

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are verified in a phased manner over a period of three years. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on verification carried out during the year.

(c) Fixed assets disposed off during the year were not substantial, and therefore, do not affect the going concern assumption.

(ii) (a) The inventory, except goods-in-transit has been physically verified by the management during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures for the physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regard to the sale of goods and services. We have not observed any major weakness in the internal control system during the course of the audit.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register required to be maintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time except for purchases of certain items of inventories that are for the Companys specialised requirements and similarly for sale of certain goods for specialised requirements of buyers for which suitable sources are not available to obtain comparable quotations. However, on the basis of information and explanations provided, the same appear reasonable.

(vi) The Company has not accepted any deposits from the public during the year.

(vii) In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.

(viii) The Central Government has not prescribed the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956 for any of the products manufactured/services rendered by the Company.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues have generally been deposited regularly during the year by the Company with appropriate authorities.

There were no dues on account of Cess under Section 441A of the Act since the date from which the aforesaid Section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-tax, Sales tax, Wealth tax, Service tax, Customs duty, Excise duty, Cess and other material statutory dues were in arrears as at 31 December 2009, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Customs duty, Wealth tax and Cess which have not been deposited with the appropriate authorities on account of any dispute.

According to the information and explanations given to us, dues of Income tax, Sales tax, Service tax, Excise duty which have not been deposited on account of any dispute are listed below:

Name of the statute Nature of the dues Amount Period (Rs. 000)

Income Tax Act,1961 Disallowances arising 10,229 Assessment years in income tax proceedings 2000-2001, 2002-2003

Central Excise Act, 1944 Stock difference adjustment 4,298 2004-2005 & 2005-2006

Central Excise Act, 1944 Disallowance of Cenvat Credit 776 2004-2005, 2007-2008, 2001

Central Excise Act, 1944 For non payment of Excise 14,148 2000 Duty on Service Charges and Machine hire charges

Central Excise Act, 1944 Penalty for delayed payment 1,949 1999 of differential excise duty for supply of goods under Advance Intermediate licence.

Service Tax Disallowance of Service 20,886 2006-2007 tax on intellectual property services

Service Tax Cenvat Credit availed 2,311 2006-2007 against Service tax paid on Goods Transport Agency

Service tax Interest & Penalty for 2,553 July 2004 to Dec 2005 delayed payment of Service Tax on Royalty

Service Tax Service tax with penalty on 1,559 2008-09 tax deducted at source with respect to royalty

Central Sales tax Due to non-submission 65,560 2004-2005, of declaration form 2005-2006, 2006-07

State Sales tax Disallowance of input credit 1,515 2005-06

Karnataka VAT Act Classification of Monolithics 9,950 2005 to 2007



Name of the Statue Forum where dispute is pending

Income Tax Act,1961 Commissioner of Income Tax (Appeals)

Central Excise Act, 1944 Commissioner (Appeals)

Central Excise Act, 1944 Commissioner (Appeals), Deputy Commissioner

Central Excise Act, 1944 CESTAT, Commissioner Service tax

Central Excise Act, 1944 CESTAT

Service Tax CESTAT

Service Tax Additional Commissioner

Service tax CESTAT

Service Tax Joint Commissioner of Central Excise

Central Sales tax Commissioner (Appeals), Revisional Board State Sales tax Commissioner (Appeals),

KarnatakaVATAct Kamataka Sales Tax Appellate Tribunal

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial year and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to its bankers or to any financial institution. The Company did not have any outstanding debentures during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidht/mutual benefit fund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions.

(xvi) The Company did not have any term loans outstanding during the year.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we are of the opinion that the funds raised on short-term basis and repaid during the year have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares to companies/firms/parties covered in the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For B S R & Associates Chartered Accountants

Vikram Aggarwal

Place: Gurgaon Partner

Date : 23 February, 2010 Membership No.: 089826

 
Subscribe now to get personal finance updates in your inbox!