Mar 31, 2023
To the Members of Emami Limited
Report on the Audit of the Standalone Financial StatementsOpinion
We have audited the accompanying standalone financial statements of Emami 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 Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013, 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 profit 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 standalone 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 Standalone Financial Statements'' section of our report. We are independent of the Company in accordance
with the ''Code of Ethics'' issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the 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 standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended March 31, 2023. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each 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 standalone financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone financial statements.
Key audit matters |
How our audit addressed the key audit matter |
(a) Recoverability of Minimum Alternate Tax ("MAT") Credit (as described in note 3.8 and 3.48 of the standalone financial statements) |
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One of the manufacturing facilities of the Company is availing tax benefits under section 80IE of Income Tax Act, 1961 (IT Act) as a result of which the Company is paying taxes under MAT to the government basis the book profits. As on 31st March, 2023, the Company has Minimum Alternate Tax (MAT) credit entitlement amounting to H37,362.55 lacs. The utilization of MAT credit entitlement will be through offsetting it when the Company pays normal taxes under the provision of Income Tax Act, 1961. Therefore, the recoverability of MAT credit entitlement is dependent upon generation of sufficient future taxable profits within the stipulated period prescribed under the Income Tax Act, 1961. Recoverability of MAT credit entitlement is sensitive to the assumptions used by the management to determine the forecasted profits, expected future market scenario, economic conditions, interpretation of tax laws, management''s expansion plans etc. Accordingly, the recoverability of MAT credit entitlement is determined as a key audit matter in our audit of the standalone financial statements. |
Our audit procedures amongst others included the following: ¦ Understood the income tax computation process for normal tax and minimum alternate tax and reviewed controls around recognition of MAT credit. Evaluated the design and tested the effectiveness of relevant controls in this regard. ¦ Assessed management''s assumptions that substantiate the probability that the unused MAT credit will be recovered through taxable profit under normal provision in future years and also assessed the tax planning strategies, budgets and the plans prepared by the management and the relevant tax legislations. ¦ Evaluated the basis used in determining the forecasted income of taxable and non-taxable units including allocations of costs. ¦ Reviewed returns submitted to the relevant tax authorities and compared these with the basis for accounting records. ¦ Evaluated the adequacy of the disclosures made by the Company in this regard in the standalone financial statements. |
(b) Revenue from sale of goods (as described in note 2.2.a, note 3.31 and note 3.60 to the standalone financial statements) |
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The Company recognizes revenues when control of the goods is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. In determining the sales price, the Company considers the effects of rebates and discounts (variable consideration). The terms of arrangements in case of domestic and exports sales, including the timing of transfer of control, the nature of discount and rebates arrangements, delivery specifications including incoterms, create complexity and judgment in determining sales revenues. The risk is, therefore, that revenue may not be recognised in accordance with terms of Ind AS 115 ''Revenue from contracts with customers'', and accordingly, it is determined to be a key audit matter in our audit of the standalone financial statements. |
Our audit procedures amongst others included the following: ¦ Considered the appropriateness of the Company''s revenue recognition policy in terms of Ind AS 115 ''Revenue from contracts with customers''. ¦ Assessed the design and tested the operating effectiveness of internal financial controls related to revenue recognition. ¦ Performed sample tests of individual sales transaction and traced to sales invoices and other related documents. In respect of the samples selected, tested that the revenue has been recognized in accordance with Ind AS 115. ¦ Selected sample of sales transactions made pre- and post- year end and tested the period of revenue recognition based on underlying documents. ¦ Selected samples of rebates and discounts during the year, compared them with the supporting documents and performed re-calculation of those variable considerations as per scheme documents. ¦ Assessed the adequacy of relevant disclosures made in the standalone financial statements. |
Key audit matters |
How our audit addressed the key audit matter |
(c) Impairment assessment of Investment in certain subsidiaries (as described in note 3.5 to the standalone financial statements) |
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The Company carries its investment in subsidiaries at cost and performs an impairment assessment for certain investment as per applicable Ind AS. For these assessments, the Company involves external valuer to determine the recoverable value of such investments using the discounted cash flow method of valuation, which is highly sensitive to changes in inputs used in valuation and involves judgement due to inherent uncertainty in the assumptions used for forecasting the future cash flows. Accordingly, the impairment assessment of investments in certain subsidiary companies is determined to be a key audit matter in our audit of the standalone financial statements |
Our audit procedures amongst others included the following: ¦ Assessed the design and tested the operating effectiveness of internal financial controls related to impairment assessment of investments in subsidiaries. ¦ Evaluated the objectivity and competence of the external valuation specialist involved by the management for such valuation and obtained confirmation of independence from them. ¦ Discussed with the management the methodology and assumptions used in the valuation including discount rates, expected growth rates and terminal growth rates. ¦ Involved valuation specialists where considered necessary, to independently assess the assumptions and methodologies used by the Company in computing the recoverable amount. In making this assessment, we also assessed the objectivity, independence and competency of the valuation specialists. ¦ Obtained suitable management representation on the projections of future cash flows and the various assumptions used in the valuation. ¦ Tested the arithmetical accuracy of the management''s impairment testing model. ¦ Assessed the adequacy of relevant disclosures made in the standalone financial statements. |
Other Information
The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility and Sustainability Report and Corporate Governance Report, but does not include the standalone financial statements and our auditor''s report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the 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 Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
¦ Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
¦ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to 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 standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements 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 subsection (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 Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written 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 standalone financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31, 2023 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditor''s Report in
accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer note 3.40 and 3.43 to the standalone financial statements;
ii. The Company did not have any longterm 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, as disclosed in the note 3.65(iv) to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("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, as disclosed in the note 3.65(v) to the standalone 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 have been
considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.
v. The interim dividends declared and paid by the Company during the year and until the date of this audit report is in accordance with section 123 of the Act. The Company has not proposed any final dividend for the year.
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. Batliboi & Co. LLP
Chartered Accountants ICAI Firm Registration Number: 301003E/E300005
per Sanjay Kumar Agarwal
Partner
Membership Number: 060352 UDIN: 23060352BGWRFO6968 Place of Signature: Kolkata Date: 25th May, 2023
Mar 31, 2022
Report on the Audit of the Standalone IND AS Financial StatementsOpinion
We have audited the accompanying Standalone Financial Statements of Emami 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 Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the Standalone Financial Statements, including a summary of significant accounting policies and other explanatory information.
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013, 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 profit 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 Standalone 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 Standalone Financial Statements'' section of our report. We are independent of the Company in accordance with the ''Code of Ethics'' issued by the Institute of
Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the 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 standalone financial statements.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements for the financial year ended March 31,2022. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each 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 standalone financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone financial statements.
Key audit matters |
How our audit addressed the key audit matter |
(a) Recognition of Unused Minimum Alternate Tax (âMATâ) Credit (as described in note 3.48 of the standalone financial statements) |
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The Company had unrecognised MAT credit balance as at the end of previous year as one of its manufacturing facilities is eligible for availing income tax benefits under section 80IE of Income Tax Act, 1961 (IT Act). The aforesaid income tax benefit under section 80IE of IT Act would expire by financial year 2025-26 and also due to the improvement in pandemic situation, the Company has reassessed its position and recognized MAT credit entitlement amounting to H28,809 lacs (H5,776 lacs pertaining to current year) in the current year. In order to determine the utilization of MAT credit in future years, the management has projected its book profits and tax profits; and based on convincing other evidence including future projections, the accumulated MAT credit has been recognized in the current year. Significant management judgement is required to determine the forecasted profits, expected future market scenario, economic conditions, interpretation of tax laws and the management''s expansion plans, and these factors impact the timing of utilization of MAT credit. Accordingly, the recognition of MAT credit basis the forecasted profits is determined as a key audit matter in our audit of the standalone financial statements. |
Our audit procedures amongst others included the following: ⢠Understood the income tax computation process for normal tax and minimum alternate tax and reviewed controls around recognition of MAT credit. Evaluated the design and tested the effectiveness of relevant controls in this regard. ⢠Assessed management''s assumptions that substantiate the probability that the unused MAT credit will be recovered through taxable profit under normal provision in future years and also assessed the tax planning strategies, budgets and the plans prepared by the management and the relevant tax legislations. ⢠Evaluated the basis used in determining the forecasted income of taxable and non-taxable units including allocations of costs ⢠Reviewed correspondences/returns submitted to the relevant tax authorities and compared these with the basis for accounting entries. ⢠Evaluated the adequacy of the disclosures made by the Company in this regard in the standalone financial statements. |
(b) Revenue from sale of goods (as described in note 2.2.a, note 3.31 and note 3.60 to the standalone financial statements) |
|
The Company recognizes revenues when control of the goods is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. In determining the sales price, the Company considers the effects of rebates and discounts (variable consideration). The terms of arrangements in case of domestic and exports sales, including the timing of transfer of control, the nature of discount and rebates arrangements, delivery specifications including in coterms, create complexity and judgment in determining sales revenues. The risk is, therefore, that revenue may not be recognised in accordance with terms of Ind AS 115 ''Revenue from contracts with customers, and accordingly, it is determined to be a key audit matter in our audit of the standalone financial statements. |
Our audit procedures amongst others included the following: ⢠Considered the appropriateness of the Company''s revenue recognition policy in terms of Ind AS 115 ''Revenue from contracts with customers''. ⢠Assessed the design and tested the operating effectiveness of internal financial controls related to revenue recognition. ⢠Performed sample tests of individual sales transaction and traced to sales invoices and other related documents. In respect of the samples selected, tested that the revenue has been recognized in accordance with Ind AS 115. ⢠Selected sample of sales transactions made pre- and postyear end and tested the period of revenue recognition based on underlying documents. ⢠Selected samples of rebates and discounts during the year, compared them with the supporting documents and performed re-calculation of those variable considerations as per scheme documents. ⢠Assessed the adequacy of relevant disclosures made in the standalone 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, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information , but does not include the standalone financial statements and our auditor''s report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the Standalone Financial Statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the 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 standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management is responsible for assessing the 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 Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
⢠Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) (i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to 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 standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements 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, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
(e) On the basis of the written 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 standalone financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31,2022 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 3.40 and 3.43 to the standalone financial statements;
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company
iv. a) As represented by the management, to the best of its knowledge and belief, and as more fully disclosed in note 3.65 to the standalone financial statements, no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("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) As represented by the management, to the best of its knowledge and belief, and as more fully disclosed in note 3.65 to the standalone 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 have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.
v. The interim dividend declared and paid by the Company during the year and until the date of this audit report is in accordance with section 123 of the Act. The Company has not proposed any final dividend for the year.
For S.R. BATLIBOI & CO. LLP
Chartered Accountants ICAI Firm Registration Number: 301003E/E300005
per Sanjay Kumar Agarwal
Partner
Membership Number: 060352 UDIN: 22060352AIYTXJ4011
Place of Signature: Kolkata Date: May 13, 2022
Mar 31, 2021
Report on the audit of the standalone ind AS financial
statements
We have audited the accompanying standalone Ind AS financial statements of Emami Limited ("the Company"), which comprise the Balance sheet as at March 31 2021, the Statement of Profit and Loss including other comprehensive income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and notes to the standalone Ind AS 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 standalone Ind AS 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, 2021, its profit 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 standalone Ind AS 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 standalone Ind AS 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 standalone Ind AS financial statements.
We draw attention to note 3.58 to the standalone Ind AS financial statements, which describes the uncertainties and potential impact of the covid-19 pandemic on the Company''s operations and results as assessed by the management. The actual results may differ from such estimates depending on future developments. Our opinion is not modified in respect of this matter.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31, 2021. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each 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 standalone Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
(a) Non-recognition of Unused Minimum Alternate Tax ("MAT") Credit (as described in note 3.47 of the standalone Ind AS financial statements) |
|
As at March 31, 2021, the Company has unused MAT credit balance of H27,985.28 lacs which has not been recognized in the books. |
Our audit procedures amongst others included the following: ⢠Understood the income tax computation process for normal tax and minimum alternate tax and reviewed |
One of the manufacturing facilities of the Company is availing |
controls around recognition of MAT credit. Evaluated the |
tax benefits under section 80IE of Income Tax Act, 1961 (IT |
design and tested the effectiveness of relevant controls |
Act) as a result of which the Company is paying taxes under MAT to the government basis book profits. |
in this regard. ⢠Assessed management''s assumptions that substantiate |
The credit of such taxes paid under MAT shall be allowed to |
the probability that the unused MAT credit will not |
be utilized in subsequent years when tax becomes payable |
be recovered through taxable income under normal |
on the total income in accordance with the normal provisions |
provision in future years and also assessed the tax |
of the IT Act. |
planning strategies, budgets and the plans prepared by |
In order to determine the utilization of such credit in future |
the management and the relevant tax legislations. |
years, the management has projected its book profits and tax |
⢠Evaluated the adequacy of the disclosures made by the |
profits; and based on such projections after considering the |
Company in this regard in the standalone Ind AS financial |
potential impact of the pandemic, MAT credit has not been recognized. Significant management judgement is required to determine the forecasted profits, expected future market scenario, economic conditions, tax laws and the management''s expansion plans, and these factors impact the timing of utilization of MAT credits. Accordingly, the non-recognition of MAT credit basis the forecasted profits is determined to be a key audit matter in our audit of the standalone Ind AS financial statements. |
statements. |
(b) Revenue from sale of goods (as described in note 2.2.a, |
note 3.30 and note 3.63 to the standalone Ind AS financial |
statements) |
|
The Company recognizes revenues when control of the goods |
Our audit procedures included the following: |
is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. In determining the sales price, the Company considers the effects of rebates and discounts |
⢠Considered the adequacy of the Company''s revenue recognition policy and its compliance in terms of Ind AS 115 ''Revenue from contracts with customers''. |
(variable consideration). The terms of arrangements in case of |
⢠Assessed the design and tested the operating |
domestic and exports sales, including the timing of transfer |
effectiveness of internal financial controls related to |
of control, the nature of discount and rebates arrangements, |
revenue recognition. |
delivery specifications including incoterms, create complexity and judgment in determining sales revenues. |
⢠Performed sample tests of individual sales transaction and traced to sales invoices and other related documents. In |
The risk is, therefore, that revenue is not recognised in |
respect of the samples selected, tested that the revenue |
accordance with terms of Ind AS 115 ''Revenue from contracts |
has been recognized in accordance with Ind AS 115. |
with customers'', and accordingly, it is determined to be a key audit matter in our audit of the standalone Ind AS financial statements. |
⢠Selected sample of sales transactions made pre-and post-year end and tested the period of revenue recognition based on underlying documents. |
⢠Selected samples of rebates and discounts during the year, compared them with the supporting documents and performed re-calculation of those variable considerations as per scheme documents. |
|
⢠Assessed the relevant disclosures made in the standalone Ind AS 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, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the standalone Ind AS financial statements and our auditor''s report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information 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. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management for the standalone ind AS financial statements
The Company''s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the 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 standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Ind AS financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Company''s financial reporting process.
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
⢠Identify and assess the risks of material misstatement of the standalone Ind AS 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 standalone Ind AS financial statements, including the disclosures, and whether the standalone Ind AS 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 standalone Ind AS financial statements for the financial year ended March 31, 2021 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, 2016 ("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 other comprehensive income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the 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 standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in "Annexure 2" to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31,2021 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements -Refer Note 3.28, note 3.39 and note 3.42 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
For S.R. BATLIBOI & CO. LLP
Chartered Accountants ICAI Firm Registration Number: 301003E/E300005
per Sanjay Kumar Agarwal
Partner
Membership Number: 060352
UDIN: 21060352AAAABM7239
Place of Signature: Kolkata Date: May 25, 2021
Mar 31, 2019
REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
OPINION
We have audited the accompanying standalone Ind AS financial statements of Emami Limited (âthe Companyâ), which comprise the Balance sheet as at March 31 2019, the Statement of Profit and Loss including other comprehensive income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and 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 standalone Ind AS financial statements give the information required by the Companies Act, 2013, as amended (âthe Actâ) in the manner so required and give a true and fair view in conformity with the accounting principles generality accepted in India, of the state of affairs of the Company as at March 31, 2019, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
BASIS FOR OPINION
We conducted our audit of the standalone Ind AS 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 standalone Ind AS 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 fuifiiied 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 standalone Ind AS financial statements.
KEY AUDIT MATTERS
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone Ind AS financial statements for the financial year ended March 31, 2019. These matters were addressed in the context of our audit of the standalone Ind AS financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each 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 fuifiiied the responsibilities described in the Auditorâs responsibilities for the audit of the standalone Ind AS financial statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the standalone Ind AS financial statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying standalone Ind AS financial statements.
Key audit matters |
How our audit addressed the key audit matter |
Non-recognition of Unused Minimum Alternate Tax (âMATâ) Credit (as described in note 3.45 of the standalone |
|
Ind AS financial statements) |
|
As at March 31, 2019, the Company has unused MAT credit balance of INR 24,866.39 lacs which has not been recognized in the books. Some of the manufacturing facilities of the Company are availing tax benefits under section 80IC / 80IE of Income Tax Act, 1961 as a result of which the Company is paying taxes under MAT to the government basis book profits. The credit of such taxes paid under MAT shall be allowed to be set off by the Company in subsequent years when tax becomes payable on the total income in accordance with the normal provisions of the Act. In order to determine the utilization of such credit in future years, the management has forecasted its book profits and tax profits basis which MAT credit has not been recognized. Significant management judgement is required to determine the forecasted profits, expected future market, economic conditions, tax laws and the managementâs expansion plans and these factors impact the timing of utilization of MAT credits. Accordingly, the non-recognition of MAT credit basis the forecasted profits is determined to be a key audit matter in our audit of the standalone Ind AS financial statements. |
Our audit procedures amongst others included the following: - Understood the income tax computation process for normal tax and minimum alternate tax and reviewed controls around recognition of MAT credit, and evaluated the design and tested the effectiveness of relevant controls in this regard. - Reviewed managementâs assumptions that substantiate the probability that the unused MAT credit will not be recovered through taxable income under normal provision in future years and also assessed the tax planning strategies, budgets and the plans prepared by the management and the relevant tax legislations. - Assessed the historical accuracy of managementâs assumptions. - Evaluated the adequacy of the disclosures made by the Company in this regard in the standalone Ind AS financial statements. |
Impairment assessment of Intangible assets (as described in note 3.52(v) of the standalone Ind AS financial statements) |
|
The Company has significant intangible assets arising from the acquisition of brand, trademark, know-how etc. in the normal course of its business. There are indicators that the carrying value of the intangibles may not be recovered through its continuing use and hence, the management has performed impairment testing in accordance with Ind AS 36. Recoverability of the intangible asset is based on forecast of projected cash flows over the remaining useful life of underlying intangible assets and their discounted present value (after considering terminal value), which are inherently highly judgmental and is subject to achieving forecasted results. Accordingly, the impairment testing of intangible asset is considered as a key audit matter because the underlying assumptions are highly judgmental and are affected by future market and economic conditions which are inherently uncertain. |
Our audit procedures amongst others included the following: - Tested the Companyâs internal controls around cash flow projections. - Assessed the adequacy of the Companyâs valuation methodology applied in determining the recoverable amount. - Evaluated the assumptions used in forecasting cash flows and arriving at discounted cash flows. We also evaluated the adequacy of sensitivity analysis on key assumptions performed by the management. We involved specialists when performing these procedures. - Assessed the relevant disclosures made in the standalone Ind AS financial statements. |
Revenue from sale of goods (as described in note 2.2.a, note 3.28 and note 3.58 to the standalone Ind AS financial statements) |
|
The Company recognizes revenues when control of the goods is transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. In determining the sales price, the Company considers the effects of rebates and discounts (variable consideration). The terms of arrangements in case of domestic and exports sales, including the timing of transfer of control, the nature of discount and rebates arrangements, delivery specifications including incoterms, create complexity and judgment in determining sales revenues. The risk is, therefore, that revenue is not recognised in the correct period in accordance with terms of Ind AS 115 âRevenue from contracts with customersâ, and accordingly, it was determined to be a key audit matter in our audit of the standalone Ind AS financial statements. |
Our audit procedures included the following: - Considered the adequacy of the Companyâs revenue recognition policy and its compliance in terms of Ind AS 115 âRevenue from contracts with customersâ. - Assessed the design and tested the operating effectiveness of internal controls related to revenue recognition. - Performed sample tests of individual sales transaction and traced to sales invoices and other related documents. In respect of the samples selected, tested that the revenue has been recognized as per the incoterms in accordance with Ind AS 115. - Selected sample of sales transactions made pre-and post-year end, agreed the period of revenue recognition to underlying supporting documents. - Assessed the relevant disclosures made in the standalone Ind AS financial statements. |
OTHER INFORMATION
The Companyâs Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Boardâs Report including Annexures to Boardâs Report, Business Responsibility Report, Corporate Governance and Shareholderâs Information, but does not include the standalone Ind AS financial statements and our auditorâs report thereon.
Our opinion on the standalone Ind AS financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone Ind AS financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the standalone Ind AS financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
RESPONSIBILITIES OF MANAGEMENT FOR THE STANDALONE IND AS FINANCIAL STATEMENTS
The Companyâs Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the 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 standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone Ind AS financial statements, management is responsible for assessing the Companyâs ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors are also responsible for overseeing the Companyâs financial reporting process.
AUDITORâS RESPONSIBILITIES FOR THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about whether the standalone Ind AS 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, individuality or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone Ind AS financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the standalone Ind AS 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 system in place and the operating effectiveness of such controls.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of managementâs use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Companyâs ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditorâs report to the related disclosures in the standalone Ind AS financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditorâs report. However, future events or conditions may cause the Company to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the standalone Ind AS financial statements, including the disclosures, and whether the standalone Ind AS 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 compiled with relevant ethical requirements regarding independence, and to communicate with them ail relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone Ind AS financial statements for the financial year ended March 31, 2019 and are therefore the key audit matters. We describe these matters in our auditorâs report unless law or regulation precedes 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 (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 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 other comprehensive income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the 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, 2019, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2019, from being appointed as a director in terms of Section 164 (2) of the Act;
(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company with reference to these standalone Ind AS financial statements and the operating effectiveness of such controls, refer to our separate Report in âAnnexure 2â to this report;
(g) In our opinion, the managerial remuneration for the year ended March 31, 2019 has been paid / provided by the Company to its directors in accordance with the provisions of section 197 read with Schedule V to the Act;
(h) With respect to the other matters to be included in the Auditorâs Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 3.27, Note 3.37 and Note 3.40 to the standalone 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 has been no delay 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) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification of all the fixed assets 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. No material discrepancies were noticed on such verification.
(c) According to the information and explanations given by the management the title deeds of immovable properties included in property, plant and equipment are held in the name of the Company except for following 9 number of immovable properties aggregating to RS.544.76 lacs as at March 31, 2019, details of which are set out in note 3.1 to the standalone Ind AS financial statements.
Asset Class |
Gross Block As at 31st 2019 March 2019 (in Rs. Lacs) |
Net Block As at 31st March (in Rs. Lacs) |
No. of cases |
Building |
410.06 |
403.94 |
4 |
Freehold Land |
140.82 |
140.82 |
5 |
Grand Total |
550.88 |
544.76 |
9 |
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.
(iii) (a) The Company has granted loans to one of its wholly owned subsidiary covered in the register maintained under section 189 of the Companies Act, 2013. In our opinion and according to the information and explanations given to us, the terms and conditions of the grant of such loans are not prejudicial to the Companyâs interest.
(b) The Company has granted loans to one of its wholly owned subsidiary covered in the register maintained under section 189 of the Companies Act, 2013. The schedule of repayment of principal and payment of interest has been stipulated for the loans granted and the receipt of interest is regular. Repayment of principal has not fallen due during the year.
(c) There are no amounts of loans granted to companies, firms or other parties listed in the register maintained under section 189 of the Companies Act, 2013 which are overdue for more than ninety days.
(iv) In our opinion and according to the information and explanations given to us, provisions of section 185 and 186 of the Companies Act 2013 in respect of loans and advances given, investments made and, guarantees, and securities given have been complied with by the Company.
(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) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii) (a) Undisputed statutory dues including provident fund, employeesâ state insurance, income-tax, goods and service tax, duty of custom, cess and other statutory dues have generally been regularly deposited with the appropriate authorities.
(b) According to the information and explanations given to us, no undisputed dues in respect of provident fund, employeesâ state insurance, income-tax, goods and service tax, duty of custom, 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.
(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, service tax, goods and service tax, duty on custom, duty of excise, value added tax and cess on account of any dispute, are as follows:
Name of the statute |
Nature of dues |
Amount (Rs.in lacs) |
Period to which the amount relates (Financial Year) |
Forum where dispute is pending |
Sales Tax and Central Sales Tax |
Various Sales tax related matters |
2,334.63 |
1989-90 to 1990-91, 1993-94 to 2007-08, 2009-10 to 2012-13, 2014-15 to 2016-17 |
High Court / Jt. Commissioner (Appeals) / Supreme Court / Tribunal / DC /Addi. Commissioner (Appeals) / DRS.(Appeal) |
The Central Excise Act, 1994 |
Excise duty demand |
635.86 |
1993-94 to 1995-96, 2008-09 to 2012-13 |
Assistant Commissioner |
MP Entry Tax Act, 1976 |
Entry Tax demand |
9.28 |
2001-02 |
High Court |
The West Bengali Tax on Entry of Goods into Local Areas Act, 2012. |
Entry Tax demand |
456.87 |
2013-14 to 2015-16 |
High Court |
Customs Act, 1962 |
Custom Duty demand |
25.39 |
2008-09 |
Commissioner (A) |
Service Tax (Finance Act, 1994) |
Service tax demand |
336.33 |
2008-09 to 2011-12 |
Assistant Commissioner/ Commissioner (A) |
Income Tax Act, 1961 |
Income Tax |
0.16 |
2013-14 |
Tribunal |
(viii) According to information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of loans or borrowings to banks. The Company did not have any outstanding loans or borrowings dues in respect of a financial institution or to government or dues to debenture holders 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 standalone Ind AS financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or 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 managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.
(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 standalone Ind AS financial statements, as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence not commented upon.
(xv) According to information and explanations given by the management, the Company has not entered into any non-cash 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.
We have audited the internal financial controls over financial reporting of Emami Limited (âthe Companyâ) as of March 31, 2019 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.
MANAGEMENTâS RESPONSIBILITY FOR INTERNAL FINANCIAL CONTROLS
The Companyâs Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
AUDITORâS RESPONSIBILITY
Our responsibility is to express an opinion on the Companyâs internal financial controls over financial reporting with reference to these standalone Ind AS financial statements based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the âGuidance Noteâ) and the Standards on Auditing as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls and, both issued by the Institute of Chartered Accountants of India. 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 with reference to these standalone Ind AS financial statements 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 over financial reporting with reference to these standalone Ind AS financial statements and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting with reference to these standalone Ind AS financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditorâs judgement, including the assessment of the risks of material misstatement of the standalone Ind AS 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 internal financial controls over financial reporting with reference to these standalone Ind AS financial statements.
MEANING OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING WITH REFERENCE TO THESE IND AS FINANCIAL STATEMENTS
A companyâs internal financial control over financial reporting with reference to these standalone Ind AS financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companyâs internal financial control over financial reporting with reference to these standalone Ind AS financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairy 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 generality accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the companyâs assets that could have a material effect on the financial statements.
INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING WITH REFERENCE TO THESE STANDALONE IND AS FINANCIAL STATEMENTS
Because of the inherent imitations of internal financial controls over financial reporting with reference to these standalone Ind AS financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting with reference to these standalone financial statements to future periods are subject to the risk that the internal financial control over financial reporting with reference to these standalone Ind AS financial statements 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, the Company has, in all material respects, adequate internal financial controls over financial reporting with reference to these standalone Ind AS financial statements and such internal financial controls over financial reporting with reference to these standalone financial statements were operating effectively as at March 31, 2019, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For S.R. Batliboi & CO. LLP
Chartered Accountants
ICAI Firm Registration Number: 301003E/E300005
per Sanjay Kumar Agarwal
Partner
Membership Number: 060352
Place of Signature: Koikata
Date: May 27, 2019
Mar 31, 2018
INDEPENDENT AUDITOR''S REPORT
To
The Members of Emami Limited
REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS
We have audited the accompanying standalone Ind AS financial statements of Emami Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss including other comprehensive income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.
MANAGEMENT''S RESPONSIBILITY FOR THE STANDALONE IND AS 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 standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with 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.
AUDITOR''S RESPONSIBILITY
Our responsibility is to express an opinion on these standalone 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 there under. We conducted our audit of the standalone 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 auditor''s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
OPINION
In our opinion and to the best of our information and according to the explanations given to us, the standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2018, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.
OTHER MATTER
The Ind AS standalone financial statements of the Company for the year ended March 31, 2017, included in these standalone Ind AS financial statements, have been audited by the predecessor auditor who expressed an unmodified opinion on those financial statements dated May 4, 2017
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
1. As required by the Companies (Auditor''s report) Order, 2016 ("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 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, the Statement of Profit and Loss including other comprehensive income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;
(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the 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 "Annexure 2" to this report;
(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, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 3.26, Note 3.36 and Note 3.39 to the standalone 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 has been no delay 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) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification once in three years 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, the title deeds of immovable properties included in property, plant and equipment are held in the name of the company.
(ii) The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.
(iii) (a) The Company has granted loans to one of
its wholly owned subsidiary covered in the register maintained under section 189 of the Companies Act, 2013. In our opinion and according to the information and explanations given to us, the terms and conditions of the grant of such loans are not prejudicial to the Company''s interest.
(b) The Company has granted loans to one of its wholly owned subsidiary covered in the register maintained under section 189 of the Companies Act, 2013. The schedule of repayment of principal and payment of interest has been stipulated for the loans granted and its repayment has not fallen due during the year.
(c) There are no amounts of loans granted to companies, firms or other parties listed in the register maintained under section 189 of the Companies Act, 2013 which are overdue for more than ninety days.
(iv) In our opinion and according to the information and explanations given to us, provisions of section 185 and 186 of the Companies Act 2013 in respect of loans and advances given, investments made and, guarantees, and securities given have been complied with by the Company.
(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) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under section 148(1) of the Companies Act, 2013, and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.
(vii) (a) Undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, goods and service tax, duty of custom, duty of excise, value added tax, cess and other statutory dues have generally been regularly deposited with the appropriate authorities.
(b) According to the information and explanations given to us, no undisputed dues in respect of provident fund, employees'' state insurance, income-tax, service tax, sales-tax, goods and service tax, duty of custom, duty of excise, value added 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.
(c) According to the records of the Company, the dues outstanding of income-tax, sales-tax, service tax, goods and service tax, duty on custom, duty of excise, value added tax and cess on account of any dispute, are as follows:
(viii) According to information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of loans or borrowings to banks or dues to debenture holders. The Company did not have any outstanding loans or borrowings dues in respect of a financial institution or to government during the year.
Name of the statute |
Nature of dues |
Amount (H in lacs) |
Period to which the amount relates (Financial Year) |
Forum where dispute is pending |
Sales Tax and Central Sales Tax |
Various Sales tax related matters |
933.88 |
1989-90 to 1990-91, 1993-94 to 2007-08, 2009-10 to 2012-13, 2014-15 to 2016-17 |
High Court / Jt. Commissioner (Appeals) / Supreme Court / Tribunal / DC |
The Central Excise Act, 1994 |
Excise duty demand |
582.25 |
1993-94 to 1995-96, 2004-05 to 2017-18 |
CESTAT / Assistant Commissioner / Superintendent of Central Excise / Supreme Court / Assistant Commissioner |
MP Entry Tax Act, 1976 |
Entry Tax demand |
9.28 |
2001-02 |
Tribunal |
The West Bengal Tax on Entry of Goods into Local Areas Act, 2012. |
Entry Tax demand |
287.16 |
2013-14 to 2014-15 |
High Court |
Customs Act, 1962 |
Custom Duty demand |
12.20 |
2008-09 |
Commissioner (A) |
Service Tax (Finance Act, 1994) |
Service tax demand |
175.52 |
2008-09 to 2011-12 |
Assistant Commissioner/ Commissioner (A) / Additional Commissioner of Service Tax / CESTAT |
Income Tax Act, 1961 |
Income Tax and Transfer Pricing) |
68.36 |
2008-09, 2010-11, 2013-14 |
Tribunal / CIT(A) |
(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 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 managerial remuneration has been paid / provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act, 2013.
(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 to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence not commented upon.
(xv) According to information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him.
(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.
We have audited the internal financial controls over financial reporting of Emami Limited ("the Company") as of March 31, 2018 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")
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 issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the 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 Companies Act, 2013.
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 on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls and, both issued by the Institute of Chartered Accountants of India. 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the 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, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.
For S.R. Batliboi & Co. LLP
Chartered Accountants ICAI
Firm Registration Number: 301003E/E300005
per Sanjay Kumar Agarwal
Partner
Membership Number: 060352
Place of Signature: Kolkata
Date: May 3, 2018
Mar 31, 2017
Report on the Standalone Ind AS Financial Statements
We have audited the accompanying standalone Ind AS financial statements of EMAMI LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes In Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information (herein after referred to as "standalone Ind AS financial statements).
Managementâs Responsibility for the Standalone Ind AS Financial Statements
The Companyâs Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cashflows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Act read with relevant Rules issued thereunder.
This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditorâs Responsibility
Our responsibility is to express an opinion on these standalone 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 standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditorâs judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Companyâs preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Companyâs Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.
Opinion
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs (financial position) of the Company as at 31st March, 2017, and its profit (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.
Report on Other Legal and Regulatory Requirements
I. As required by the Companies (Auditorâs Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in "Annexure A", a statement on the matters specified in paragraphs 3 and 4 of the Order.
II. 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 accounts 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, the Cash Flow Statement and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.
d. In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act, read with relevant Rules issued thereunder.
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 and the operating effectiveness of such controls, refer to our separate Report in "Annexure B";
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 standalone Ind AS financial statements (Refer Note No. 3.36 & 3.39 to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
iv. The Company has provided requisite disclosures in its standalone Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and these are in accordance with the books of accounts maintained by the Company. [Refer Note 3.42 to the standalone Ind AS financial statements].
Annexure -A to the Independent Auditorsâ Report
The Annexure referred to in our Independent Auditorâs Report to the members of EMAMI LIMITED (the Companyâ) on the standalone Ind AS financial statements for the year ended on 31st March 2017. We report that:
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 fixed assets are verified in a phased manner over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.
(c) According to information and explanation given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.
ii. The inventories have been physically verified during the year by the management at regular intervals. In our opinion and according to the information and explanations given to us, no material discrepancies were noticed on physical verification.
iii. The Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 (âthe Actâ). Accordingly, paragraph 3(iii)(a), 3(iii)(b) and 3(iii)(c) of the Order is not applicable to the Company.
iv. In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of sections 185 and 186 of the Companies Act, 2013 in respect of loans, investments, guarantees and securities made.
v. The Company has not accepted any deposits from the public.
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, and are of the opinion that prima facie the prescribed accounts and records have been made and maintained.
vii. According to the information and explanations given to us in respect of statutory dues:
(a) The Company has been regular in depositing undisputed statutory dues, including Provident Fund, Employees State Insurance, Income Tax, Service Tax, Sales Tax, Value Added Tax, duty of Custom, duty of Excise, Cess and other statutory dues with the appropriate authorities during the year. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2017 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 material dues of duty of customs and service tax which have not been deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us, the following dues of income tax, Sales tax, duty of excise and value added tax have not been deposited by the Company on account of disputes:
Name of the Statute |
Nature of Dues |
Amount under dispute not yet deposited (Rs. In Lacs) |
Financial year to which the amount relates |
Forum where the dispute is pending |
14.27 |
2005-06 |
ADC |
||
185 64 |
1996-2001, 2009-11, 2012-13, 2014-15, 2016-17 |
AC(A), DC(A), JC(A) & Addl CCT |
||
Sales Tax Act and Local Sales Tax Act |
Sales Tax |
509.34 |
1990-91, 2000-06, 2010-12, 2013-14, 2015-17 |
Tribunal/Boarc of Revenue |
264.4 |
1999-2000, 2004-07 |
High Court |
||
113.5 |
1989-90, 1993-97 |
Supreme Court |
||
The Central Excise Act, 1934 |
Excise Duty |
28.33 |
2009-13, 2014-15 |
Commissioner (Appeals) |
5 48 |
1993-96, 2009-10 |
CESTAT |
||
Income Tax Act, 1961 |
Income Tax |
70.68 |
2008-09 & 2010-11 |
CIT (A) |
viii. In our opinion and according to information and explanations given by the management, we are of the opinion that the Company has not defaulted in the repayment of dues to financial institution, banks, government and debenture holders.
ix. To the best of our knowledge and belief and according to the information and explanations given to us, term loans availed by the Company were applied by the Company for the purposes for which the loans were obtained. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments) during the year.
x. According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.
xi. According to the information and explanations given to us, the Company has paid/provided for managerial remunerations in accordance with the requisite approvals mandated by the provisions of Sec 197 read with Schedule V to the Act.
xii. In our opinion and according to the information and explanations given to us, the Company is not a Nidhi company. Accordingly, paragraph 3(xii) of the Order is not applicable.
xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable accounting standards.
xiv. According to the information and explanations give to us and based on our examination of the records, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.
xv. According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into non-cash transactions with directors or persons connected with them. Accordingly, paragraph 3(xv) of the Order is not applicable.
xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.
For, S. K. AGRAWAL & CO.
Chartered Accountants
Firmâs Registration Number- 306033E
S.K.Agrawal
Place: Kolkata Partner
Dated: May 4, 2017 Membership No: 9067
Mar 31, 2014
We have audited the accompanying financial statements of Emami Limited
("the Company") which comprise the Balance Sheet as at 31st March, 2014
and the Statement of Profit and Loss and the Cash Flow Statement for
the year ended on that date 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") (which continues 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.
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 of
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 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:
i) In the case of the Balance Sheet, of the State of affairs of the
Company as at 31st March, 2014
ii) In the case of the Statement of Profit and Loss, of the Profit for
the year ended on that date; and
iii) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
Report on other Legal and Regulatory Requirement
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 & 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 accounts as required by law have been
kept by the Company so far as appears from our examination of such
books.
c) The Balance Sheet, Statement of Profit & Loss & Cash Flow Statement
referred to in this report are in agreement with the books of accounts.
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 (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 written representations received from the directors
as on March 31, 2014 and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2014 from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
1. 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 program of verification, covering all
fixed assets over a period of three years, 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. Fixed assets disposed of during the year were not substantial and
therefore, do not affect the going concern assumption.
2. a. As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
b. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
c. In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3. The Company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
Accordingly, clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5. a. According to the information and explanations given to us,
particulars of contracts or agreements that needed to be entered into
the register maintained under section 301 of the Companies Act, 1956
have been so entered.
b. According to the information and explanations given to us, the
Company has entered into transactions in pursuance of such contracts or
arrangements in respect of parties listed in the register maintained
under section 301of the Companies Act, 1956 at prices which are prima
facie reasonable having regard to the prevailing market prices at the
relevant time.
6. The Company has not accepted any deposits as defined under section
58A & 58AA or other relevant provisions of the Companies Act, 1956.
7. In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8. 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9. According to the information and explanations given to us in
respect of statutory and other dues:
a. The Company has been regular in depositing undisputed statutory
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, Cess and other Statutory dues with the
appropriate authorities during the year. According to the information
and explanations given to us, there were no undisputed amount payable
in respect of these statutory dues which have remained outstanding as
at 31st March, 2014 for a period of more than six months from the date
they became payable.
b. Contingent dues (excluding penalty and interest as applicable) on
account of Sales Tax, Income Tax, Entry Tax, Service Tax, Excise Duty
disputed by the Company and not being paid vis-Ã -vis forums where such
disputes are pending are mentioned below:
Name of the
Statute Nature
of Dues Amount under
dispute Financial year
to which the
amount Forum where the
not yet
deposited relates dispute is
pending
(Rs.in Lacs)
2.20 2013-14 JC
25.79 2005-06, 2008-09
& 2010-11 ADC
394.55 2009-10, 2011-12
to 2013-14 AC(A)
181.36 2000-01 to
2005-06 Board of Revenue
Central
Sales
1990-91, 2000-01,
2002-03 to
2006-07,
222.11 Tribunals
Tax Act and 2008-09, 2009-10
& 2012-13
Sales Tax
Local Sales
Tax
182.42 1999-00, 2004-05
to 2006-07 High Court
Act
12.92 2003-04 to
2004-05 JC (A)
0.37 2010-11 DC (A)
14.91 1996-97 to
2000-01 DC
113.50 1989-90, 1993-94
to 1996-97 Supreme Court
Assistant
4.70 2002-03 to
2005-06 Commissioner of
Central Excise
241.44 2008-09 to
2010-11 CESTAT
The Central
Excise Duty Excise Commiss
-ioner
Excise Act,
1934
4.98 1993-94,
1995-96 Appeals
Commissioner
0.51 2009-10 (Appeals)Central
Excise
9.28 2001-02 Board of Revenue
Entry Tax Act,
Entry Tax 0.33 2010-11 DC(A)
2008
123.90 2007-08 to
2013-14 CTO
Income Tax
Act, 1961 Income Tax 6.22 2005-06 CIT (A)
10. The Company does not have accumulated losses as at the end of the
year and the Company has not incurred cash losses during the current
and the immediately preceding financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the repayment of dues to financial
institution and banks.
12. According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. 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 and society.
14. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
15. According to the information given to us, the Company has given
guarantees for loan taken by subsidiaries from banks. Total value of
outstanding guarantee amounts to C5,703 lacs.
16. To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
Company were applied by the Company for the purposes for which the
loans were obtained.
17. According to information and explanation given to us and on an
overall examination of Balance Sheet, we report that funds raised on
short-term basis have not been used during the year for long-term
investment.
18. The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act, 1956 during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the Company does not arise.
19. The Company has not issued any secured debentures during the year.
20. The Company has not raised any money by way of public issue during
the year.
21. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For S. K. AGRAWAL & COMPANY
Chartered Accountants
Registration No- 306033E
S. K. AGRAWAL
Kolkata Partner
5th May, 2014 Membership No: 9067
Mar 31, 2013
Report on the Financial Statements
We have audited the accompanying financial statements of Emami Limited
("the Company") which comprise the Balance Sheet as at 31st March
2013, and the Statement of Profit and Loss and the Cash Flow Statement
for the year ended on that date 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 of
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 circumstances. An audit also
includes evaluating the appropriateness of accounting policies used and
the reasonableness of the accounting estimates made by management, as
well as evaluating the overall presentation of the financial
statements.
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:
i) In the case of the Balance Sheet, of the State of affairs of the
Company as at 31st March, 2013
ii) In the case of the Statement of Profit and Loss, of the Profit for
the year ended on that date; and
iii) In the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.
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 & 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 accounts as required by law have been
kept by the Company so far as appears from our examination of such
books.
c) The Balance Sheet, Statement of Profit & Loss & Cash Flow Statement
referred to in this report are in agreement with the books of accounts.
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.
e) On the basis of written representations received from the directors
as on March 31, 2013, and taken on record by the Board of Directors,
none of the directors is disqualified as on March 31, 2013, from being
appointed as a director in terms of clause (g) of sub-section (1) of
section 274 of the Companies Act, 1956.
1. 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 program of verification, covering all
fixed assets over a period of three years, 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. Fixed assets disposed of during the year were not substantial and
therefore, do not affect the going concern assumption.
2. a. As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
b. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
c. In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3. The Company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
Accordingly, clauses (iii) (b), (iii)(c), (iii)(d), (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5. a. According to the information and explanations given to us,
particulars of contracts or agreements that needed to be entered into
the register maintained under section 301 of the Companies Act, 1956,
have been so entered.
b. According to the information and explanations given to us, the
Company has entered into a transaction in pursuance of such contracts
or arrangements in respect of a party listed in the register maintained
under section 301of the Companies Act, 1956 at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
6. The Company has not accepted any deposits as defined under section
58A & 58AA or other relevant provisions of the Companies Act, 1956.
7. In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8. 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9. According to the information and explanations given to us in
respect of statutory and other dues:
a. The Company has been regular in depositing undisputed statutory
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, Cess and other Statutory dues with the
appropriate authorities during the year According to the information
and explanations given to us, there were no undisputed amount payable
in respect of these statutory dues which have remained outstanding as
at 31st March, 2013 for a period of more than six months from the date
they became payable
b. Contingent dues on account of Sales Tax, Income Tax, Customs Duty,
Wealth Tax, Service Tax, Excise Duty, Cess disputed by the Company and
not being paid vis-a-vis forums where such disputes are pending are
mentioned below:
10. The Company does not have accumulated losses as at the end of the
year and the Company has not incurred cash losses during the current
and the immediately preceding financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the repayment of dues to financial
institution and banks.
12. According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
14. According to the information given to us, the Company has given
guarantees for loan taken by subsidiaries from banks. Total value of
outstanding guarantee amounts to H 51.50 Crores.
15. To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
Company were applied by the Company for the purposes for which the
loans were obtained.
16. According to information and explanation given to us and on an
overall examination of Balance Sheet, we report that funds raised on
short-term basis have not been used during the year for long-term
investment.
17. The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act, 1956, during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the Company does not arise.
18. The Company has not issued any secured debentures during the year.
19. The Company has not raised any money by way of public issue during
the year.
20. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For, S. K. AGRAWAL & COMPANY
Chartered Accountants
Registration No- 306033E
S. K. AGRAWAL
Kolkata Partner
6th May 2013 Membership No:9067
Mar 31, 2012
We have audited the Balance Sheet of Emami Limited as at 31st March,
2012 and also the Statement of Profit & Loss and the Cash Flow
Statement 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.
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. 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.
We further report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit
b) In our opinion proper books of accounts as required by law, have
been kept by the company so far as appears from our examination of such
books.
c) The Balance Sheet, Statement of Profit & Loss & Cash Flow Statement
referred to in this report are in agreement with the books of accounts
and comply with the Accounting Standards referred to in Section 211(3C)
of the Companies Act, 1956 to the extent applicable.
d) On the basis of written representations received and taken on record
by the Board of Directors, we report that none of the Directors are
disqualified as on 31st March, 2012 from being appointed as a Director
in terms of Section 274 (1) (g) of the Companies Act, 1956.
e) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts, read with 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:
i. In the case of Balance Sheet of the State of Affairs of the Company
as on 31st March, 2012; ii. In the case of Statement of Profit & Loss
of the Profit for the year ended on that date; and
iii. In the case of Cash Flow Statement, of the Cash Flows for the year
ended on that date.
As required by the Companies (Auditor's Report) Order, 2003 issued by
the Central Government and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we further report that:
1. 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 program of verification, covering all
fixed assets over a period of three years, 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) Fixed assets disposed of during the year were not substantial and
therefore, do not affect the going concern assumption.
2. a) As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
c) In our opinion and according to the information and explanations
given to us, the company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3. The Company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
Accordingly, clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5. a) According to the information and explanations given to us,
particulars of contracts or agreements that needed to be entered into
the register maintained under section 301 of the Companies Act, 1956,
have been so entered.
b) According to the information and explanations given to us, the
company has entered into a transaction in pursuance of such contracts
or arrangements in respect of a party listed in the register maintained
under section 301 of the Companies Act, 1956 at prices which are
reasonable having regard to the prevailing market prices at the
relevant time.
6. The Company has not accepted any deposits as defined under section
58A & 58AA or other relevant provisions of the Companies Act, 1956.
7. In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8. 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9. According to the information and explanations given to us in
respect of statutory and other dues:
a) The company has been regular in depositing undisputed statutory
dues, including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income Tax, Sales Tax, Wealth Tax, Service
Tax, Customs Duty, Excise Duty, Cess and other Statutory dues with the
appropriate authorities during the year. According to the information
and explanations given to us, there were no disputed amount payable in
respect of these statutory dues which have remained outstanding as at
31st March 2012 for the period of more than six months from the date
they became payable.
b) Contingent dues on account of Sales Tax, Income Tax, Customs Duty,
Wealth Tax, Service Tax, Excise Duty, Cess disputed by the company and
not being paid vis-ÃÂ -vis forums where such disputes are pending are
mentioned below:
Name of the Nature of Dues Amount under dispute
Statute not yet deposited
(Rs. in lacs)
Central Sales Sales tax including 11.14
Tax Act and interest and penalty 14.27
Local Sales as applicable 181.36
Tax Act 0.81
179.72
85.63
11.34
65.00
14.91
62.25
107.25
The Central
Excise Excise Duty including 4.83
Act, 1994 penalty and interest 68.85
as applicable 26.38
15.11
46.16
229.00
42.02
Service Tax Service Tax including 44.33
(Finance
Act, 1994) penalty and interest
as applicable
Entry Tax Act,
2008 Entry Tax 9.28
Income Tax
Act, 1961 Income Tax 4.10
Name of the Statue Financial year
to which Forum where the
the amount relates dispute is pending
Central Sales
Tax Act and
Local Sales
Tax Act 2000-01 & 2004-05 WB Taxation Tribunal
2005-06 ADC
2000-01 to 2005-06 Board of Revenue
1999-2000 High Court
2005-06 & 2006-07 High Court
2001-02 JC
2004-05 JC (A)
2005-06 & 2006-07 DC (A)
1996-97 to 2000-01 DC
1999-2000 to 2004-05 Tribunal
1989-90, 1993-94
to 1996-97 Supreme Court
The Central Excise
Act, 1994 1983-84 to 1990-91 Assistant Commissioner
of Central Excise
1981-82 to 1986-87,
1989-90 Deputy Commissioner of
Excise
2006-07 to 2009-10 Additional Commissioner
of Customs
2002-03 to 2005-06 High Court (Mumbai)
2008-09 to 2010-11 Joint Commissioner of
(Excise & Customs)
2008-09 to 2009-10 CESTAT
1993-94 to 1995-96 Commissioner
Service Tax
(Finance Act, 1994) 2005-2008 CESTAT
Entry Tax Act, 2008 2001-02 Board of Revenue
Income Tax Act, 1961 2007-08 CIT (A)
10. The Company does not have accumulated losses as at the end of the
year and the company has not incurred cash losses during the current
and the immediately preceding financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
company has not defaulted in the repayment of dues to financial
institution and banks.
12. According to the information and explanations given to us, the
company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
14. According to the information given to us, the company has not
given guarantees for loan taken by others from a Bank.
15. To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
company were applied by the company for the purposes for which the
loans were obtained.
16. Based on overall examination of Balance Sheet of the Company as at
March 31st 2012, short term funds were applied for the purpose for
which they were obtained.
17. The company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act 1956, during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the company does not arise.
18. The company has not issued any secured debentures during the year.
19. The company had not raised any money by way of public issue during
the year.
20. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For S K Agrawal & Company
Chartered Accountants
Firm Registration No.- 306033E
S. K. Agrawal
Place: Kolkata Partner
Dated: 8th May, 2012 Membership No. 9067
Mar 31, 2011
We have audited the Balance Sheet of Emami Limited as at 31st March,
2011 and also the Profit & Loss Account and the Cash Flow Statement 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.
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. 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.
We further report that:
a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purpose of our
audit.
b) In our opinion proper books of accounts as required by law have been
kept by the company so far as appears from our examination of such
books.
c) The Balance Sheet, Profit & Loss Account & Cash Flow Statement
referred to in this report are in agreement with the books of accounts
and comply with the accounting standards referred to in Section 211(3C)
of the Companies Act, 1956 to the extent applicable.
d) On the basis of written representations received from the Directors
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.
e) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts, read with notes on
accounts as per schedule 17 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 Balance Sheet of the State of Affairs of the Company
as on 31st March, 2011;
ii. In the case of the Profit & Loss Account of the Profit for the year
ended on that date; and
iii. In the case of Cash Flow Statement, of the Cash Flows for the year
ended on that date.
As required by the Companies (Auditor's Report) Order, 2003 issued by
the Central Government and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we further report that:
1. 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 program of verification, covering all
fixed assets over a period of three years, 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. Fixed assets disposed off during the year were not substantial and
therefore, do not affect the going concern assumption.
2. a. As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
b. In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
c. In our opinion and according to the information and explanations
given to us, the company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3. The Company has neither granted nor taken any loans, secured or
unsecured to/from companies, firms or other parties covered in the
register maintained under section 301 of the Companies Act, 1956.
Accordingly, clauses (iii)(b), (iii)(c), (iii)(d), (iii)(f) and
(iii)(g) of paragraph 4 of the Order are not applicable.
4. In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5. a. According to the information and explanations given to us,
particulars of contracts or agreements that needed to be entered into
the register maintained under section 301 of the Companies Act, 1956,
have been so entered.
b. According to the information and explanations given to us, the
company has not entered into any transactions in pursuance of such
contracts or arrangements aggregating during the year to Rs. 5,00,000 or
more in respect of each party listed in the register maintained under
section 301 of the Companies Act, 1956 for purchase of goods, materials
and sales of goods.
6. The Company has not accepted any deposits as defined under section
58A & 58AA or other relevant provisions of the Companies Act, 1956.
7. In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8. We have broadly reviewed the books of accounts 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9. According to the information and explanations given to us in respect
of statutory and other dues:
a. The company has been regular in depositing undisputed statutory
dues, including Provident Fund, Employees State Insurance, Income Tax,
Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and
other Statutory dues with the appropriate authorities during the year.
According to the information and explanations given to us, there were
no disputed amount payable in respect of these statutory dues which
have remained outstanding as at 31st March 2011 for the period of more
than six months from the date they became payable.
b. Contingent dues on account of Sales Tax, Income Tax, Customs Duty,
Wealth Tax, Service Tax, Excise Duty, Cess disputed by the company and
not being paid vis-ÃÂ -vis forums where such disputes are pending are
mentioned below:
Name of the Nature of
Dues Amount under
dispute Financial
Year to Forum where the
Statute not yet
deposited which the
amount dispute is pending
Rs. in Lacs relates
Central Sales Sales tax
including 3.54 2004-05 Revisional Board
Tax Act and penalty as
applicable 14.27 2005-06 ADC
Local Sales 181.36 2000-2001 to
2005-06 Board of revenue
Tax Act 0.81 1999-2000 High Court
179.72 2005-06 and
2006-07 High Court
85.63 2001-02 JC
11.34 2004-05 JC (A)
128.98 1998-99,
2005-06 to
2008-09 DC (A)
3.36 2004-05 DC
14.91 1996-97 to
2000-01 DC
89.45 1999-2000
to 2004-05 Tribunal
The Central Excise Duty 4.83 1983-84 to
1990-91 Assistant
Commissioner
Excise Act, including penalty of Central
Exise
1944 as applicable 68.85 1981-82 to
1986-87, Deputy Commiss
-ioner
1989-90 of Excise
26.38 2006-07 to
2009-10 Additional
Commissioner
of Customs
9.40 2002-03 to
2005-06 Commissioner (A)
37.52 2008-09 to
2010-11 Joint
Commissioner
(Excise and
Customs)
452.59 2004-05 to
2007-08 Joint
Commissioner
(Excise and
Customs)
253.74 2008-09 to
2009-10 Commissioner
Divisional
range
Service Tax Service Tax
including 5.13 2005-06 CESTAT
(Finance Act, penalty as
applicable 30.78 2004-05 to
2007-08 Joint Commiss
-ioner (CBEC)
1994)
The Assam Entry Tax 9.28 2001-02 Board of Revenue
Entry Tax
Act, 2008 314.02 2006-07 to
2010-11 Supreme Court
Income Tax Income Tax 5.22 2007-08 CIT (A)
Act, 1961
10. The Company does not have accumulated losses as at the end of the
year and the company has not incurred cash losses during the current
and the immediately preceding financial year.
11. Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
company has not defaulted in the repayment of dues to financial
institution and banks.
12. According to the information and explanations given to us, the
company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13. According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
14. According to the information given to us, the company has given
guarantees for loan taken by others from a Bank. As explained the terms
and conditions thereof are not prejudicial to the interest of the
company.
15. To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
company were applied by the company for the purposes for which the
loans were obtained.
16. Based on overall examination of Balance Sheet of the Company as at
March 31st 2011, short term funds were applied for the purpose for
which they were obtained.
17. The company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act 1956, during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the company does not arise.
18. The company had not raised any money by way of public issue during
the year.
19. To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For S. K. Agrawal & Company
Chartered Accountants
Registration No. 306033E
S. K. Agrawal
Kolkata Partner
May 19, 2011 Membership No. 9067
Mar 31, 2010
We have audited the Balance Sheet of Emami Limited as at March 31, 2010
and also the Profit & Loss Account and the Cash Flow Statement 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.
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. 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.
We further report that:
a) The accounts of Units at Pantnagar, Masat, Dongri and Vapi have been
audited by the Unit Auditors and their reports have been considered by
us in preparing our report.
b) 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.
c) In our opinion proper books of accounts as required by law have been
kept by the company so far as appears from our examination of such
books.
d) The Balance Sheet, Profit & Loss Account & Cash Flow Statement
referred to in this report are in agreement with the books of accounts
and comply with the accounting standards referred to in Section 211(3C)
of the Companies Act, 1956 to the extent applicable.
e) On the basis of written representations received from the Directors
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 Section 274 (1) (g) of the Companies Act,
1956.
f) As stated in Note B-20 of Schedule 17, based on experts report,
useful life of goodwill has been reviewed leading to the increase in
the amount of amortisation of goodwill.
g) In our opinion and to the best of our information and according to
the explanations given to us, the said accounts, read with notes on
accounts as per schedule 17 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 Balance Sheet of the State of Affairs
of the Company as on March 31, 2010;
ii. In the case of the Profit & Loss Account of the Profit for the year
ended on that date; and
iii. In the case of Cash Flow Statement,of the Cash Flows for the year
ended on that date.
As required by the Companies (Auditors Report) Order, 2003 issued by
the Central Government and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we further report that:
1) 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 program of verification, covering all
fixed assets over a period of three years, 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) Fixed assets disposed of during the year were not substantial and
therefore, do not affect the going concern assumption.
2) a) As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
c) In our opinion and according to the information and explanations
given to us, the company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3) a) The Company has granted unsecured loans to two parties covered
in the register maintained under section 301 of the Companies Act,
1956. The maximum amount outstanding amounts to Rs.21436.54 Lacs and
the year end balance is Rs.1695.62 Lacs.
b) The company has not taken unsecured loans from any company covered
in the register maintained under section 301 of the Companies Act,
1956.
c) The rate of interest and other terms and conditions
in respect of above loans are prima facie not prejudicial to the
interest of company.
d) The payment of the principal amount and interest are also regular.
4) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5) a) According to the information and explanations
given to us, particulars of contracts or agreements that needed to be
entered into the register maintained under section 301 of the Companies
Act, 1956, have been so entered.
b) According to the information and explanations given to us, the
company has not entered into any transactions in pursuance of such
contracts or arrangements aggregating during the year to Rs 5,00,000 or
more in respect of each party listed in the register maintained under
section 301 of the Companies Act, 1956 for purchase of goods, materials
and sales of goods.
6) The Company has not accepted any deposits as
defined under section 58A & 58AA or other relevant provisions of the
Companies Act, 1956.
7) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8) 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9) According to the information and explanations given to us in respect
of statutory and other dues:
a) The company has been generally regular in depositing undisputed
statutory dues, including Provident Fund, Employees State Insurance,
Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise
Duty, Cess and other Statutory dues with the appropriate authorities
during the year. According to the information and explanations given to
us, there were undisputed amount payable in respect of these statutory
dues which have remained outstanding as at March 31, 2010 for the
period of more than six months from the date they became payable are
mentioned below:
Name of the Statute Nature of Dues Amount
(Rs. in Lacs)
Maharashtra Value Added Tax, 2002 Value added Tax 0.22
The Central Sales Tax Act, 1956 Central Sale 0.02
Tax 0.06
Name of the Statute Period to it Due Date Date of
relates Payment
Maharashtra Value
Added Tax, 2002 21.05.2009
The Central Sales
Tax Act, 1956 2009-10 21.04.2009 27.05.2010
21.06.2009
b) Contingent dues on account of Sales Tax, Income Tax, Customs Duty,
Wealth Tax, Service Tax, Excise Duty, Cess disputed by the company and
not being paid vis-ÃÂ -vis forums where such disputes are pending are
mentioned below:
Name of the Nature of Dues Amount under dispute
Statute not yet deposited
Rs. in Lacs
Central Sales Sales tax including 3.54
Tax and State penalty as applicable 8.26
Sales Tax 14.27
181.36
0.81
183.64
101.79
85.63
3.00
80.72
3.36
14.91
104.43
Name of the Financial Year to Forum where the
Statute which the amount dispute is pending
relates
Central Sales 2004-05 Revisional Board
Tax and State 2006-07 Additional Commissioner
Sales Tax 2005-06 ADC
2000-2001 to 2005-06 Board of revenue
1999-2000 High Court
2005-06 and 2006-07
1993-94 to 1996-97
2001-2002 JC
2002-2003
JC (A)
1998-99, 2005-06 to
2006-07 and 2008-09 DC (A)
2004-2005 DC
1996-1997 to 2000-01 DC
1999-2000 to 2005-2006 Tribunal
Name of the Nature of Dues Amount under dispute
Statute not yet deposited
Rs. in Lacs
Excise duty Excise Duty including 4.83
penalty as applicable
68.85
9.40
462.51
Service Tax Service Tax including 5.13
penalty as applicable 30.78
122.92
Entry Tax Entry Tax 9.28
223.13
Name of the Financial Year to I Forum where the
Statute which the amount dispute is pending
relates
Excise duty 1983-84 to 1990-91 Assistant Commissioner of
Central Excis
1981-82 to 1986-87, Deputy Commissioner
1989-90 of Excise
2002-03 to 2004-05 Commissioner (A)
2004-05 to 2007-08 Joint Commissioner
(Excise and Customs)
Service Tax 2005-06 CESTAT
2004-05 to 2007-08 Joint Commissioner (CBEC)
2008-09 to 2009-10 Commissioner Divisional
range
Entry Tax 2001-02 Board of Revenue
2006-07 to 2009-10 Supreme Court
10) The Company does not have accumulated losses as at the end of the
year and the company has not incurred cash losses during the current
and the immediately preceding financial year.
11) Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
company has not defaulted in the repayment of dues to financial
institution and banks.
12) According to the information and explanations given to us, the
company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
14) According to the information given to us, the company has given
guarantees for loan taken by others from a Bank. As explained the terms
and conditions thereof are not prejudicial to the interest of the
company.
15) To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
company were applied by the company for the purposes for which the
loans were obtained.
16) Based on overall examination of Balance Sheet of the Company as at
March 31, 2010, short term funds were applied for the purpose for which
they were obtained.
17) The company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act 1956, during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the company does not arise.
18) During the year, the company had raised money by way of placement
of equity shares to Qualified Institutional Buyers (QIBs). We have
verified the end use of the money raised as disclosed by the Management
in the Notes to accounts.
19) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For S. K. Agrawal & Company
Chartered Accountants
Registration No. 306033E
S. K. Agrawal
Partner
Membership No. 9067
Kolkata
May 28, 2010
Mar 31, 2009
We have audited the Balance Sheet of Emami Limited as at March 31, 2009
and also the Profit & Loss Account and the Cash Flow Statement 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.
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. 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.
We further report that:
a) The accounts of Zandu FMCG undertaking with effect from appointed
date have been audited by the Statutory Auditors of The Zandu
Pharmaceuticals Works Ltd and their report have been considered by us
in preparing our report.
b) 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.
c) In our opinion proper books of accounts as required by law have been
kept by the Company so far as appears from our examination of such
books.
d) The Balance Sheet, Profit & Loss Account & Cash Flow Statement
referred to in this report are in agreement with the books of accounts
and comply with the accounting standards referred to in Section 211(3C)
of the Companies Act, 1956 to the extent applicable.
e) On the basis of written representations received from the Directors
and taken on record by the Board of Directors, we report that none of
the Directors is disqualified as on March 31, 2009 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, subject to, Note B-17
regarding change in accounting of foreign exchange differences and Note
B-21 regarding change in accounting policy of government grants and
reference is invited to Note B-20(e) regarding transfers from General
Reserve to Profit & Loss Account equivalent to the amount of Goodwill
amortised, read with other notes on accounts as per schedule 17 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 Balance Sheet of the State of Affairs of the
Company as on March 31, 2009;
ii. In the case of the Profit & Loss Account of the Profit for the
year ended on that date; and
iii. In the case of Cash Flow Statement, of the Cash Flows for the
year ended on that date.
As required by the Companies (Auditors Report) order, 2003 issued by
the Central Government and on the basis of such checks as we considered
appropriate and according to the information and explanations given to
us, we further report that: 1) (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 program of verification, covering all
fixed assets over a period of three years, 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) Fixed assets disposed of during the year were not substantial and
therefore, do not effect the going concern assumption.
2 (a) As explained to us, inventories were physically verified during
the year by the management at reasonable intervals.
(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verification of inventories
followed by the management are reasonable and adequate in relation to
the size of the Company and nature of its business.
(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventory. The discrepancies noted on physical verification of stocks
as compared to book records were not significant and the same has been
properly dealt with in the books of accounts.
3) (a) The Company has not granted any loans, secured or unsecured, to
companies, firms and other parties covered in the register maintained
under section 301 of the Companies Act, 1956.
b) The Company has taken unsecured loans from one company covered in
the register maintained under section 301 of the Companies Act, 1956,
against whom the maximum amount outstanding at any time during the year
is Rs. 3,545 lacs and the year end balance is Rs. 32.63 lacs.
c) The rate of interest and other terms and conditions in respect of
above loans are prima facie not prejudicial to the interest of company.
d) The payment of the principal amount and interest are also regular.
4) In our opinion and according to the information and explanations
given to us, there are adequate internal control procedures
commensurate with the size of the Company and the nature of its
business for the purchase of inventory and fixed assets and for the
sale of goods. We have not observed any continuing failure to correct
major weaknesses in the internal control system.
5) (a) According to the information and explanations given to us,
particulars of contracts or agreements that needed to be entered into
the register maintained under section 301 of the Companies Act, 1956,
have been so entered.
(b) According to the information and explanations given to us, the
Company has not entered into any transactions in pursuance of such
contracts or arrangements aggregating during the year to Rs. 5,00,000
or more in respect of each party listed in the register maintained
under section 301 of the Companies Act, 1956 for purchase of goods,
materials and sales of goods.
6) The Company has not accepted any deposits as defined under section
58A & 58AA or other relevant provisions of the Companies Act, 1956.
7) In our opinion, the Company has an adequate internal audit system
commensurate with the size and nature of its business.
8) 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 and are of the opinion that prima facie the prescribed
accounts and records have been made and maintained.
9) According to the information and explanations given to us in respect
of statutory and other dues:
a) The Company has been generally regular in depositing undisputed
statutory dues, including Provident Fund, Employees State Insurance,
Income Tax, Sales Tax, Wealth Tax, Service Tax, Customs Duty, Excise
Duty, Cess and other Statutory dues with the appropriate authorities
during the year. According to the information and explanations given to
us, there were no undisputed amount payable in respect of these
statutory dues which have remained outstanding as at March 31, 2009 for
the period of more than six months from the date they became payable.
b) Contingent dues on account of Sales Tax, Income Tax, Customs Duty,
Wealth Tax, Service Tax, Excise Duty, Cess disputed by the Company and
not being paid vis- ÃÂ -vis forums where such disputes are pending are
mentioned below:
Name of the Nature of Dues Amount under dispute
Statute not yet deposited
(Rs. in lacs)
Central Sales Tax Sales tax including 34.66
and State Sales Tax interest and penalty 14.27
as applicable 95.34
68.4
0.81
209.08
85.63
0.14
192.42
297.95
111.12
113.42
14.91
Excise duty Excise Duty 4.83
68.85
16.14
Entry Tax Entry Tax 17.05
Trade Tax Unnao Sales Tax 3.36
Name of the Statue Financial Year to which Forum where the
dispute
the amount relates is pending
Central Sales Tax
and State Sales Tax 2004-05 AC
2005-06 ADC
2000-01 to 2003-04 Board of Revenue
2004-05 to 2005-06 DC (A)
1999-00
High Court
2005-06 & 2006-07
2001-02 JC
2000-01 Sr. DC (A)
2001-02 to 2002-03
2004-05 to 2005-06 JC (A)
2007-08
1997-98, 1999-00,
Tribunal
2000-01 to 2004-05
1996-97 to 2000-2001 DC (A)
1983-84 to 1990-91 Assistant Commissioner of
Central Excise
1981-82 to 1986-87, Deputy Commissioner
1989-90 of Excise
2000-2001 to 2005-06 Commissioner of
Central Excise (Appeals)
2001-02 to 2002-03 Board of Revenue
2004-05 Deputy Commissioner
of sales tax (Assessment)
10) The Company does not have accumulated losses as at the end of the
year and the Company has not incurred cash losses during the current
and the immediately preceding financial year.
11) Based on our audit procedures and on the basis of information and
explanations given by the management, we are of the opinion that the
Company has not defaulted in the repayment of dues to financial
institution and banks.
12) According to the information and explanations given to us, the
Company has not granted loans and advances on the basis of security by
way of pledge of shares, debentures and other securities.
13) According to the information and explanations given to us, the
Company is not dealing or trading in shares, securities, debentures and
other investments.
14) According to the information given to us, the Company has given
guarantees for loan taken by others from a Bank. As explained the terms
and conditions thereof are not prejudicial to the interest of the
Company.
15) To the best of our knowledge and belief and according to the
information and explanations given to us, term loans availed by the
Company were applied by the Company for the purposes for which the
loans were obtained.
16) Based on overall examination of Balance Sheet of the Company as at
March 31, 2009, short term funds of Rs. 9,700 lacs have been utilised
for long term application. As per the information and explanation
given to us, the same is attributable to the then turbulent economic
scenario. Further, company has informed that sufficient long term fund
have been augmented by raising funds through placement with QIBs in the
financial year 2009-10.
17) The Company has not made any preferential allotment of shares to
parties and companies covered in the Register maintained under section
301 of the Companies Act 1956, during the year and hence the question
of whether the price at which shares have been issued is prejudicial to
the interest of the Company does not arise.
18) The Company concluded its public offering during the financial year
2004-05. Out of Rs. 3,500 lacs raised, the amount has been used as per
the details given in Note no. B-4 of Schedule 17.
19) To the best of our knowledge and belief and according to the
information and explanations given to us, no fraud on or by the Company
was noticed or reported during the year.
For S K Agrawal & Company
Chartered Accountants
S K Agrawal
Place: Kolkata Partner
Dated: December 03, 2009 Membership No. 9067